PepsiCo (NASDAQ:PEP) shares are up more than 2% Tuesday afternoon after a textbook “beat and raise’ with its third quarter results that surprised analysts at Barclays.
Excluding non-recurring items, core earnings per share of $2.25 were ahead of the FactSet consensus of $2.15 while revenue of $23.45 billion, up from $21.97 billion, was also ahead of the FactSet consensus of $23.41 billion.
For 2023, the company revised its core EPS guidance to $7.54 from $7.47 previously.
“We think it’s safe to say that a ‘beat & raise’ was not seen as being on the cards today for PEP, let alone the very early & constructive commentary on 2024 expectations,’ analysts wrote.
“To us, results in aggregate speak to the increasing balance in the business model across US and non-US markets, and we see this as also supporting the company’s confidence in discussing the high-end of the long-term algorithm for next year.”
Revenue at Frito-Lay North America rose 7%, while it was up 5% at Quaker Foods North America.
“Domestically, the all-important Frito Lay North America business came through in line with our revenue estimates and we think volumes here down just 50 [basis points] will be seen as positive versus trends in recent scanner data & broader worries about the snacking category,” analysts wrote.
Contact Andrew Kessel at andrew.kessel@proactiveinvestors.com
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