PepsiCo Trading forecasts and signals

PepsiCo (NYSE: PEP) revenue for the fourth quarter of 2021 exceeded consensus by $1 billion. At the same time, the company announced an increase in the cost of production of snacks and carbonated drinks, as well as an increase in the cost of their placement in stores.PepsiCo's results are influenced by inflation. The manufacturer of chips and snacks Frito-Lay North America notes the increase in the cost of vegetable oil and packaging. PepsiCo Beverages North America, which is engaged in the production of carbonated beverages, recorded an increase in the cost of transportation and raw materials.In this regard, the company has increased product prices. In October, a price increase was announced in the first fiscal quarter of 2022. This did not affect the demand for the corporation's products.PepsiCo Chief Financial Officer Hugh Johnston said the continued loyalty of consumers to brands, which allows the company to raise prices.The corporation's net profit for the fourth quarter decreased from last year's $1.85 billion ($1.33 per share) to $1.32 billion ($0.95 per share). However, excluding one-time factors, EPS was $1.53, slightly exceeding the consensus of FactSet, which laid the indicator at $1.52. PepsiCo's net sales increased by 12% to $25.25 billion, with a forecast of $24.24 billion.Total organic revenue (excluding acquisitions and asset sales) increased by 11.9% in the quarter. The corporation's forecast for the current year suggests a slowdown in growth to 6%, almost 10% compared to last year's pace.Frito-Lay's organic revenue increased by 13% in the quarter. In the beverage segment, the indicator rose by 12%, the revenue of Quaker Foods in North America increased by 9%. In Latin America, this indicator increased higher than in other regions of presence — by 17%.PepsiCo expects to return about $7.7 billion to shareholders this year. Of this amount, $6.2 billion will be allocated for dividends, and $1.5 billion for share repurchase.Quite predictably, PepsiCo pointed out the existence of problems with supply chains, as well as an increase in the cost of raw materials and transportation. The dynamics of the corporation's revenue was caused by both an increase in prices for its products and a stable demand for it. This proves that PepsiCo is able to effectively transfer its costs to the buyer. PepsiCo's business is better diversified than that of its main competitor Coca-Cola. An increase in the buyback program will allow the company to keep quotes from serious drawdowns. Our target price for PepsiCo stock is ...

The American multinational corporation in the food industry, manufacturer of soft drinks and other food products PepsiCo reported the results of the second quarter of 2021. The shares reacted with an increase of +2.3%.The share price of PepsiCo, after falling as a result of the outbreak of the pandemic, recovered faster than that of Coca-Cola. The corporation's securities continue to update historical highs. Above expectations PepsiCo reported revenue growth to $19.22 billion (+20.5% YoY). Analysts ' forecast was at the level of $17.94 billion. The indicator of organic growth increased by +12.8%. Earnings per share were $1.72 compared to $ 1.53 according to analysts ' forecast. Net profit rose to $2.36 billion from $1.65 billion a year earlier.Most of the revenue came from the divisions of the corporation Frito-Lay North America (the brands Lay's, Cheetos, Doritos, etc.) and PepsiCo Beverages North America. According to the results of the report, the highest sales growth rates of the corporation fell on the countries of Africa, the Middle East and South Asia — +63%.PepsiCo said it expects profit growth of 11% in the second half of the year, as well as organic revenue growth of 6%. Both forecasts were higher than previous expectations. The corporation plans to increase the prices of its products after Labor Day. Factors such as disruptions in global supply chains and increased demand have led to higher prices for raw materials. US inflation is growing at the fastest pace since 2008. The consumer price index in monthly terms for June was 0.9%.By 2026, PepsiCo expects to achieve annual savings of at least $1 billion due to the implementation of the labor productivity improvement program. In addition, the corporation is going to carry out a wide introduction of automation in the near future, as a result of which pre-tax fees should amount to about $3.15 billion. What should an investor do At the moment, from the point of view of technical analysis, there are no signals for new purchases. If the shares were purchased earlier, then the current levels may be attractive for fixing part of the profit. The indicators indicate a local overbought on the weekly timeframe — the formation of a local correction is possible. There is no signal to completely close positions.It is reasonable to leave the remaining part of the shares, if they are available, in the portfolio for long-term investment. It is likely that the company's indicators will continue to grow in the second half of the year, which will positively affect the price of securities. PepsiCo shares belong to the consumer goods sector and have repeatedly demonstrated themselves well when the market is declining, falling less or even giving the investor a chance to earn in difficult times.The company's capitalization is $211.3 billion. Analysts' consensus forecast for PepsiCo shares is $163 per share, which is 6.5% higher than the current price of ...