PepsiCo's (PEP) snacking turnaround showed early promise but has lost momentum, raising questions about sustainable topline growth, RBC Capital Markets said in a Monday note.

"While price cuts drove initial volume gains, macro pressures (gas prices hitting lower-income consumers) and structural shifts toward functional snacking have stalled progress," the note said.

Following several quarters of underperformance, pricing

adjustments began showing encouraging progress in Q1 of 2026, the report said.

But progress has stalled by Q2 as macro pressures intensified,

particularly rising gas prices from the Iran conflict, weighing heavily on consumer budgets, the note added.

"PFNA needs consistent topline growth for the stock to rerate, and the turnaround remains in early innings," it said. PFNA refers to PepsiCo Foods North America.

RBC kept its sector perform rating and a $161 price target.

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