PepsiCo, Inc. (PEP) Earnings: An Early Look

Earnings season is in full swing, with huge numbers of companies having already given their latest numbers to investors, and PepsiCo, Inc. (NYSE:PEP) is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarter reports is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

PepsiCo, Inc. (NYSE:PEP)

Beverage and snack-food behemoth PepsiCo has been looking throughout the world to cash in on its well-established business, fighting to gain supremacy in key emerging markets. Let’s take an early look at what’s been happening with PepsiCo over the past quarter and what we’re likely to see in its quarterly report on Thursday.

Stats on PepsiCo

Analyst EPS Estimate $1.05
Change From Year-Ago EPS (8.7%)
Revenue Estimate $19.7 billion
Change From Year-Ago Revenue 0.9%
Earnings Beats in Past 4 Quarters 4

Source: Yahoo! Finance.

Will PepsiCo fizz up this quarter?
Analysts have perennially underestimated PepsiCo’s earnings prospects, but they’ve nevertheless stayed resolute in their guesses this time around, keeping consensus projections constant for the past three months. The stock has done pretty well lately, though, rising 6% since early November as overall market sentiment has improved.

In its global business, Pepsi faces two very different sets of conditions. Globally, the company is fighting tooth and nail with rival The Coca-Cola Company (NYSE:KO) in an attempt to tap into growth markets, ranging from Asia to Africa and the Middle East. But in the U.S., growing concerns about obesity have led both PepsiCo and Coke to try to head off regulatory efforts by providing calorie information on vending machines and playing up their respective healthy-product lines.

One thing to watch for in Pepsi’s report is whether Pepsi will give in to pressure from investors to split itself up into its two major segments, allowing its successful snack business to separate from its sluggish soda segment, which has posted sales declines in the U.S. market recently. Mondelez International Inc (NASDAQ:MDLZ) achieved the same goal of accentuating its high-growth snack business when it spun off its Kraft Foods Group Inc (NASDAQ:KRFT) North American grocery business, which like Pepsi’s beverage business had lower growth and margins than its snack unit.

In evaluating Pepsi’s report, be sure to go beyond headline numbers to break out performance in each of the company’s business-line and geographical segments. Finding out where the growth is will be your best key to understanding the direction that Pepsi needs to move in to maximize its future profit potential.

The article PepsiCo Earnings: An Early Look originally appeared on Fool.com and is written by Dan Caplinger.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends Coca-Cola and PepsiCo. The Motley Fool owns shares of PepsiCo.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Biotech Insider Alert - $6 Stock To Hit $40

$200 Million Dollar Healthcare Hedge Fund's #1 Best Idea Right Now

The best healthcare hedge fund out there right now is one of the largest shareholders in this biotech stock. The fund returned more than 20% in each of the last 2 years with a virtually fully hedged portfolio, and it's sending out a BUY signal on this biotech stock. Get your FREE REPORT today (retail value of $300)

This is a FREE report from Insider Monkey. Credit Card is NOT required.
Click here to Read Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 74 percentage points in 2.5 years. Our beta is only 1.2 (download a FREE newsletter and see the details inside)

Lists

Best Selling Magazines in the World

Shortest People in History

The Most Celebrated Holidays in the World

Most Expensive Handbag Brands in the World

Top Selling Comic Book Issues of this Century

The Most Powerful Women in Politics

Best Paid DJs

Most Rebellious Female Artists

Best Paid TV Actresses of 2014

Best Paid Actors of 2014

Most Expensive Horses in the World

Tallest People Ever

Most Encouraging Feminist Celebrities

Best Paid Supermodels of 2014

Top 10 Suburbs for Retirement in 2015

10 Wealthiest Cities in America

Top 10 TED Talks for Entrepreneurs

Best TED Talks on Education

25 Most Dangerous Places to Live in America

Top 10 Ski Resorts in the United States – 2014 List

Top 10 Most Remote Places in the World

Most Visited Museums in the United States

Wealthiest Photographers in the World

Most Famous Gay Athletes

The World’s Most Famous Circuses

Best Hair Stylists

Most Popular NASCAR Drivers

The Best Romance Movies of all Time

The Most Wanted Drug Lords

The Oldest Money Managers

The Greatest Directors in the World

Largest Animals in the World

World’s Most Expensive Desserts

Best Selling Comic Books of All Time

A-list Actors who Sabotaged Their Career

Rappers With a College Degree

The Best Jazz Albums of all Time

The Most Influential Jazz Musicians

The World’s Most Famous Photographers

The Best Oscar-Winning Songs

Most Influential Choreographers Ever

Most Expensive Department Stores in the World

The Most Expensive Stolen Paintings in the World

The World’s Most Expensive Teas

Top Oscar Record Holders

The Most Expensive Flowers in the World

Countries With a Booming Film Industry

Most Expensive Cupcakes in the World

Uncommon European Escapes

The Most Stolen Artists in History

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 129% in 2.5 years!! Wondering How?

Download a complete edition of our newsletter for free!