DAVOS, SWITZERLAND — PepsiCo (PEP) CEO Ramon Laguarta wants to change the minds of food industry critics inside the new Trump administration.

"It's not a worry. I think we've been leading the transformation of the food industry for many years," Laguarta said on Yahoo Finance at the World Economic Forum in Davos, Switzerland. 

Continued Laguarta, "We've been leaders in sodium reduction, we've been leaders in sugar reduction. We've been leaders in eliminating fat from products. We've been leading in artificial colors."

Sentiment around packaged foods stocks has soured in part due to the new administration. Trump's pick to run Health & Human Services (HHS), Robert Kennedy Jr., is a noted longtime critic of the packaged foods industry.

Meanwhile, the outgoing surgeon general warned this month alcohol should come with cancer risk labels. And the US Food and Drug Administration (FDA) has banned the use of red dye No. 3 in food, drinks, and ingested drugs. Laguarta said Pepsi doesn't have the dye in its US portfolio. 

The barrage of health news has investors worried packaged food players may have to reformulate products at a significant cost. The bad press isn't exactly great for business, either.

Shares of PepsiCo are down about 14% in the past three months, underperforming the S&P 500's (^GSPC) 5% gain. The stock price of rival Coca-Cola (KO) is down 9% over the same stretch, while Spam maker Hormel's (HRL) shares are off by 3%.

"In the US, I would like for us to be also working with the new administration on how do we move forward eliminating artificial colors from food in the US. And I think it should be science-based. It should be very pragmatic," Laguarta said of PepsiCo's aim to be part of the solution. 

"We as an industry should aspire to, in three or four years, no artificial colors in food. It is ambitious. I think it is doable, and it should be a private, private-public cooperation that drives that outcome."

For PepsiCo investors, the pressured stock price also reflects its recent performance in its snacks and beverages businesses. Both have slowed amid more cautious spending by lower-income households. A rising US dollar — which weighs on international sales — hasn't helped.

Third quarter sales and earnings fell 0.6% and 5% year over year, respectively.

The Street is bracing for mixed results and an accompanying 2025 outlook when the company reports on Feb. 4.

"After a tumultuous year in 2024, which began with PepsiCo guiding towards the top end of their long-term algorithm and eventually finished with organic sales below algorithm after three downward revisions on the top line, we believe PepsiCo management understands the reality of the situation and need for improvement. We would expect a below algorithm guide on the top and bottom lines," warned RBC analyst Nik Modi.

Modi rates PepsiCo shares at Sector Perform.

"While numbers are already below algo (and believe buy side bar is below cons.), we still see potential for muted 2025 earnings as we believe PepsiCo will have a bias to reinvest to support some of the weaker parts of the business until there is greater signs of stabilization," Modi said.

—

Brian Sozzi is Yahoo Finance's Executive Editor. Follow Sozzi on X @BrianSozzi, Instagram and on LinkedIn. Tips on stories? Email brian.sozzi@yahoofinance.com. Three times each week, Sozzi fields insight-filled conversations with the biggest names in business and markets on Yahoo Finance's Opening Bid podcast. Find more episodes on our video hub. Watch on your preferred streaming service. Or listen and subscribe on Apple Podcasts, Spotify, or wherever you find your favorite podcasts.

Read the latest news and interviews from the World Economic Forum in Davos, Switzerland:

• Trump should create a strategic bitcoin reserve: Coinbase CEO

• A trade war with China is coming as Trump takes office: Bremmer

• Bank of America CEO: The Federal Reserve may have to respond to Trump

• Suntory CEO says the company has stockpiled whiskey in Europe due to possible Trump tariffs

• Trump coin and Melania coin are 'gambling tokens': Anthony Scaramucci

• Nasdaq CEO on corporate America under Trump: Quieter DEI efforts, exciting IPO environment