PepsiCo Inc. (NASDAQ: PEP) has confirmed that it will announce its earnings on Tuesday, October 5, 2021, before the market open.
What to look for
The company delivered solid double-digit net revenue and EPS growth in Q2. And considering the strong results, the company is looking forward to full-year organic growth of 6% and a core constant current EPS increase of 11%. The results offer confidence that the investment behind the company’s Faster and Better approach is working. PepsiCo is focused on building a competitive edge and winning marketplace that positions the company well with changing consumer habits.
Earnings: Stockearnings Estimated EPS is $1.72. Historical EPS performance in the past 12 quarters shows the company has topped estimates 11 times (91%) and missed zero times (0%). Net income was $2.36 billion or $1.7 per share, an increase of $1.65 billion or $1.18 per share a year ago.
Revenue: Net sales in Q2 were up 20.5% YoY to $19.22 billion, beating estimates of $17.96 billion. Organic revenue that strips the effect of foreign currency, divestitures, and the acquisition was up 12.8%. As a result, the company expects core EPS for 2021 to be around $6.2, a 12% YoY relative to core EPS of $5.52 in 2020.
Stock movement: Since the last earnings release, the stock price has gained 3.1%. The company's shares have been UP on 25 occasions over the past 44 quarters following the earnings release. So, historical price reaction shows there is a 56% chance of the share price going UP after the company releases its earnings. According to the Stockearning algorithm, the predicted first-day move is 1%, and the predicted move on the seventh day is 2%.
What analysts are saying
Deutsche Bank analyst Steve Powers has raised the share's target price from $154 to $158 and maintained a "Hold" rating on the shares ahead of the fiscal Q3 earnings on October 5. Powers is "positively biased" for significant upside to consensus estimates and organic revenue growth.
Also, Guggenheim analyst Laurent Grandet raised the target price on PepsiCo from $171 to $175 and maintained a Buy rating. The analyst cited core business accelerating as the company takes market share from Coca-Cola, the divesture of low margin, low growth Tropicana juice segment, and the expansion in the energy segment, which he sees will drive margin and growth.
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