Pepsi to report second-quarter numbers July 7

What's Happening With PEP View more about PEP >

Soft-drink maker Pepsico (PEP) is set to report its second-quarter results on July 7. The company will post quarterly numbers before the market open, with analysts forecasting earnings of $1.28 per share, down from $1.32 during the same period last year. The stock is up 5.9% on the year.

Technical Analysis

PEP was recently trading at $105.78, down $1.16 from its 12-month high and $29.30 above its 12-month low. Technical indicators for PEP are bullish and the stock is in a strong upwards trend. The stock has recent support above $101.30 and is trading above recent resistance. Of the 16 analysts who cover the stock, 10 rate it a “strong buy”, two rate it a “buy”, and four rate it a “hold”. The stock receives S&P Capital IQ’s 4 STARS “Buy” ranking.

Analysts' Thoughts

Pepsico has been enjoying a nice upward trend in 2016, due in part to a solid first-quarter report in April. The consensus for the company’s second-quarter is $1.28, but the street’s whisper number is slightly higher at $1.32, indicating Wall Street expects to see another better than expected report for Q2. Pepsi has done a good job of diversifying its portfolio. Currently just 12% of its revenue comes from Pepsi, and carbonated soft drinks on the whole account for less than a quarter of the company’s total sales. In a world where consumers are shifting away from sugary soft drinks, Pepsi’s strong stable of snacks and non-carbonated drinks make it an attractive stock in the sector. PEP has a P/E 30, which is a bit high, with earnings forecast to rise by 3.5% this year and 8.0% next year. While the consensus calls for a slight earnings drop versus the same period last year, if the company is able to hit the street’s whisper number it would translate to flat earnings growth, which would be enough to drive the stock higher. I see additional upside, but given the stock’s valuation, current shareholders may consider having a stop loss order on their current positions just in case the results do disappoint.

PEP
About PepsiCo Inc.

PepsiCo is one of the largest food and beverage companies globally. It makes, markets, and sells a slew of brands across the beverage and snack categories, including Pepsi, Mountain Dew, Gatorade, Doritos, Lays, and Ruffles. The firm uses a largely integrated go-to-market model, though it does leverage third-party bottlers, contract manufacturers, and distributors in certain markets. In addition to company-owned trademarks, Pepsi manufactures and distributes other brands through partnerships and joint ventures with companies such as Starbucks. The firm segments its operations into four primary geographies, with North America (comprising Frito-Lay North America, Quaker Foods North America, and North America beverages) constituting over 60% of consolidated revenue.

  • Last Price:
    $137.45
  • Previous Close:
    $137.64
  • Change:
    $-0.19 (-0.14%)
  • Open:
    $137.84
  • Volume:
    2,370,188
  • Average Volume (100 Day):
    4,316,318
  • Market Capitalization:
    $192.2 B
  • Day's Range:
    $137.24 - $138.30
  • Dividend Yield:
    2.78%
  • 52-week Range:
    $140 - $105.03
  • P-E:
    14.90
  • EPS:
    $9.00
  • Earnings Date:
    2/21/20
  • Ex Dividend Date:
    9/5/19
  • Sector:
    Consumer Defensive
  • Industry:
    Beverages - Soft Drinks
  • Analyst Average Recommendation:
    Moderate Buy

Already a member?

Login to see your Stocks to Watch Trade Ideas.

Not yet a member?

Receive a Morning Action trade idea every market day in the Morning Update, plus Stocks to Watch Trade Ideas every Saturday.

Become A Member

|