Pepsi (PEP, $112.59) meets Q4 expectations, but warns of challenges in 2019
While being able to match analysts’ expectation for the latest quarter’s earnings and revenue, PepsiCo. portends earnings challenges for 2019.
The soft drink behemoth reported fourth quarter earnings of $1.49 per share and revenue of $19.52 billion - both in line with what Wall Street estimated.
Pepsi’s North American beverage market increased +2% - thereby rewarding the company’s advertising investment in the region. The company’s snack business registered +4% organic revenue growth in North America for the quarter.
PepsiCo.’s fiscal fourth-quarter net income came in at $6.85 billion (or $4.83 per share), compared to a loss of -$710 million, (or -50 cents per share) of the year-ago quarter.
However, Pepsi has apparently lowered its hopes for full-year 2019 earnings, owing to currency exchange rates headwinds, increased advertising/marketing expenses, and an expected hike in the effective tax rate to 21 percent from 18.8 percent. It now predicts earnings of $5.50 per share during 2019, down from its 2018 earnings of $5.66 per share. Wall Street had expected earnings of $5.86 a share for 2019 (according to Refinitiv).
But what might be good news for the company’s shareholders is that it announced a +3% dividend increase - to $3.82 from $3.71 - starting June.
PEP in upward trend: price may jump up because it broke its lower Bollinger Band on January 06, 2025
PEP may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options. In of 41 cases where PEP's price broke its lower Bollinger Band, its price rose further in the following month. The odds of a continued upward trend are .
Technical Analysis (Indicators)
Bullish Trend Analysis
The RSI Indicator shows that the ticker has stayed in the oversold zone for 3 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an Uptrend is expected.
Bearish Trend Analysis
The Moving Average Convergence Divergence Histogram (MACD) for PEP turned negative on December 16, 2024. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 48 similar instances when the indicator turned negative. In of the 48 cases the stock turned lower in the days that followed. This puts the odds of success at .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where PEP declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Aroon Indicator for PEP entered a downward trend on January 08, 2025. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is slightly undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (12.853) is normal, around the industry mean (77.968). P/E Ratio (26.366) is within average values for comparable stocks, (31.456). Projected Growth (PEG Ratio) (2.864) is also within normal values, averaging (5.903). Dividend Yield (0.029) settles around the average of (0.027) among similar stocks. P/S Ratio (2.615) is also within normal values, averaging (3.240).
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 75, placing this stock slightly better than average.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. PEP’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
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General Information
a provider of a diversified line of soft drinks and snack foods
Industry BeveragesNonAlcoholic