PepsiCo Inc. (NYSE:PEP) is Doing Well and Expects a Brighter Future


PepsiCo Inc. (NYSE:PEP) had introduced the new cappuccino flavored Lay’s. Many of the reviewers were disappointed and did not like the chips at all. They told others to refrain from even tasting the new flavored chips as well. Fortunately, this did not put the customers off from the other products of Frito-Lay. PepsiCo Inc. (NYSE:PEP) revealed this Thursday that in the third quarter, the revenue generated by Frito-Lay increased while that of Quaker decreased. Quaker, however, is a healthier brand. The food brands that fall under PepsiCo Inc. (NYSE:PEP) are Frito-Lay, Quaker and Pepsi Soda. Throughout the company, the results for the third quarter were very good. The company beat the top and bottom lines forecasted by Wall Street.

The revenue generated in the third quarter was $17.2 billion, which was more than the estimates of the analysts at $17.1 billion. The revenue in the third quarter was 2% more than that generated in the same quarter last year. The net income for this quarter was $2 billion which was 5% more than the income in the third quarter last year. The earnings per share was marked at $1.32 which was 7% more than the earnings per share last year. After excluding special items, the earnings per share that came in were $1.36, which beat the Wall Street estimate by 7 cents.

Indra Nooyi, the chairperson and CEO of  PepsiCo Inc. (NYSE:PEP) said was proud that the company had performed so well in the third quarter given all the challenges of the macroeconomic environment that include greater volatility in the newer markets and increasing demands in the developed markets. She said that the reasons why the company achieved such great results are its wide and very diverse geographical footprint, good execution in the market, strength of all its brands and the trendy product portfolio.

The revenue generated by Frito-Lay increased by 3%, the reasons being effective pricing and volume growth. Quaker’s revenue fell by 2% in the same quarter. The revenues that came from PepsiCo Beverages were the same as those that came in last year. The consumption of non-carbonated drinks in the North America offset the carbonated drinks consumption by a decline of 1.5%.

PepsiCo Inc. (NYSE:PEP) is expecting an overall 9% growth in its earnings per share in the rest of the current fiscal. This was greater than a previous guidance according to which there should have been at least 8% growth. The company claimed that they are expecting to return to their shareholders $8.7 billion in 2014. This transaction will involve repurchases of shares worth $5 billion and dividends worth $3.7 billion.

After releasing the earnings report, PepsiCo Inc. (NYSE:PEP)’s stock increased by 1.2% in the pre-market trade. The company opened the day trade at a price that was $1.34 greater than the closing price of the stock on Wednesday. Currently, the shares have increased by 0.7% and the stock has gone up by 14%. Overall, things are looking quite good.