The 10-second takeaway
For the quarter ended Dec. 31 (Q4), PepsiCo beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue improved and GAAP earnings per share increased.
Margins dropped across the board.
PepsiCo logged revenue of $20.16 billion. The 12 analysts polled by S&P Capital IQ hoped for net sales of $19.91 billion. GAAP sales were 11% higher than the prior-year quarter's $18.16 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at $1.15. The 15 earnings estimates compiled by S&P Capital IQ predicted $1.12 per share on the same basis. GAAP EPS of $0.89 for Q4 were 4.7% higher than the prior-year quarter's $0.85 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 51.7%, 240 basis points worse than the prior-year quarter. Operating margin was 11.1%, 280 basis points worse than the prior-year quarter. Net margin was 7.0%, 50 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $12.43 billion. On the bottom line, the average EPS estimate is $0.75.
Next year's average estimate for revenue is $68.32 billion. The average EPS estimate is $4.56.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 4,323 members out of 4,461 rating the stock outperform, and 138 members rating it underperform. Among 1,194 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 1,170 give PepsiCo a green thumbs-up, and 24 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on PepsiCo is outperform, with an average price target of $70.63.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of PepsiCo. Motley Fool newsletter services have recommended buying shares of PepsiCo. Motley Fool newsletter services have recommended creating a diagonal call position in PepsiCo.
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