PepsiCo Inc. (NYSE: PEP) reported first-quarter 2016 results before markets opened Monday. The snack food and beverage company posted core (adjusted) diluted earnings per share (EPS) of $0.89 on revenues of $11.86 billion. In the same period a year ago, the company reported EPS of $0.83 on revenues of $12.22 billion. First-quarter results also compare to the Thomson Reuters consensus estimates for EPS of $0.81 and $11.88 billion in revenues.
On a GAAP basis, first-quarter EPS totaled $0.64 and net revenue fell 3% as a result of currency translation effects and currency devaluation in Venezuela.
For 2016 Pepsi continues to forecast adjusted EPS growth of 8% on a constant currency basis to $4.66. The consensus estimate had called for 2016 EPS of $4.70. Pepsi expects a negative impact of around 4% on adjusted EPS due to currency exchange transactions and 2% due to Venezuelan deconsolidation.
The company also expects organic revenue to grow by 4% this year. Free cash flow is targeted at over $7 billion on operating cash flow of more than $10 billion, and capital spending is forecast at $3 billion for the year.
Pepsi plans to pay out about $7 billion in dividends this year ($2.81 annual rate) and buy back about $3 billion in stock.
CEO Indra Nooyi said:
We delivered strong first quarter operating results driven by balanced execution of our commercial agenda and productivity programs. Our marketing initiatives and new product launches are generating solid organic top line growth, and our focus on driving greater efficiency throughout our operations contributed significantly to attractive core gross margin expansion. We are off to a strong start to the year and that gives us added confidence in achieving our financial objectives for 2016.
PepsiCo’s shares traded up about 0.2% early Monday, at $103.99 in a 52-week range of $76.48 to $105.77. Thomson Reuters had a consensus analyst price target of $109.05 before the report.
In 20 Years, I Haven’t Seen A Cash Back Card This Good
Credit card companies are at war, handing out free rewards and benefits to win the best customers. A good cash back card can be worth thousands of dollars a year in free money, not to mention other perks like travel, insurance, and access to fancy lounges. Our top pick today has pays up to 5% cash back, a $200 bonus on top, and $0 annual fee. Click here to apply before they stop offering rewards this generous.
Flywheel Publishing has partnered with CardRatings for our coverage of credit card products. Flywheel Publishing and CardRatings may receive a commission from card issuers.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
Our expert who first called NVIDIA in 2009 is predicting 2025 will see a historic AI breakthrough.
You can follow him investing $500,000 of his own money on our top AI stocks for free.