11/18/24 - $pep - LT valuation too cheap <$16011/18/24 :: VROCKSTAR :: NASDAQ:PEP
LT valuation too cheap <$160
- not going anywhere. snack king. 18x next year PE for that is, respectfully, Mr. Market, "too cheap".
- 5% FCF yield better than cash, and growing EPS in mid singles range.
- on it's SPXEW pair, holy cow - lowest ever - looks like this company is headed to oblivion (it's not)
- one of those rare period in mkt where stonks favor the energy + bitcoin + AI complex (and i don't disagree! i own bitcoin, utility solar and meta/tsm!), but AI is not coming to disrupt snacks anytime soon, ironically one of those weird long "hedges" i search for. it's a safety trade (staple, pricing power, global footprint, valuation cheap)
- cheap can always get cheaper, i'm no stranger to this
- so what i've done is taken long dated jan 17 2027 ITM $140C action in order to keep my size smallish near 1% but give myself the 4-5x leverage bump. my thinking is... any move higher and i probably just marinate and let this thing go to work and don't have to stress. any lower, and i can set that expiry lower and perhaps go larger, or even own shares (which i can sell calls on over time). but for now i want exposure at the current px but also want to keep my cash balance high.
Thoughts?
V
