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PepsiCo Has Announced New Plans for Its Consumers

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Price movement

PepsiCo (PEP) fell 0.81% to close at $100.60 per share during the fifth week of November 2016. The stock’s weekly, monthly, and year-to-date (or YTD) price movements were -0.81%, -5.0%, and 3.6%, respectively, as of December 2, 2016.

PEP is trading 1.8% below its 20-day moving average, 3.9% below its 50-day moving average, and 2.4% below its 200-day moving average.

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Related ETF and peers

The SPDR S&P 500 Growth ETF (SPYG) invests 0.91% of its holdings in PepsiCo. The YTD price movement of SPYG was 4.4% on December 2.

The market caps of PepsiCo’s competitors are as follows:

  • Coca-Cola (KO): $173.3 billion
  • Mondelez International (MDLZ): $64.1 billion
  • Dr Pepper Snapple Group (DPS): $15.7 billion

Latest news on PepsiCo

In a November 28, 2016, press release, PepsiCo stated, “Today, Pepsi announced the expansion of its PepsiMoji campaign in the U.S. with the addition of new holiday-inspired emoji characters, encouraging fans to spread holiday cheer this season and #SayItWithPepsi.”

PepsiCo added, “In addition, Pepsi launched an online holiday hub where fans can purchase special-edition PepsiMoji items, just in time for holiday shopping. Available through December 26, PepsiPopUpShop.com features festive holiday products that are perfect for gift giving, holiday party decorating and more.”

In another release that same day, PepsiCo noted, “Pepsi and Papa John’s announced the kickoff of the ‘Halftime of a Lifetime’ promotion today, giving fans a once-in-a-lifetime opportunity to get a front-row seat at the Pepsi Zero Sugar Halftime Show at Super Bowl LI.”

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Performance of PepsiCo in fiscal 3Q16

PepsiCo (PEP) reported fiscal 3Q16 net revenue of $16.0 billion, a fall of 1.8% from $16.3 billion in fiscal 3Q15. Revenue from its Frito-Lay North America and North America Beverages segments rose 3.4% and 2.9%, respectively. Revenue from its Quaker Foods North America, Latin America, and Europe Sub-Saharan Africa segments fell 2.1%, 22.8%, and 1.9%, respectively, between fiscal 3Q15 and fiscal 3Q16.

Its net income and EPS (earnings per share) rose to $2.0 billion and $1.37, respectively, in fiscal 3Q16 compared to $533.0 million and $0.36, respectively, in fiscal 3Q15. It reported non-GAAP[1. generally accepted accounting principles] EPS of $1.40 in fiscal 3Q16, a rise of 3.7% compared to fiscal 3Q15.

PEP’s cash and cash equivalents and inventories rose 12.8% and 14.7%, respectively, between fiscal 4Q15 and fiscal 3Q16.

Projections

PepsiCo (PEP) has made the following projections for fiscal 2016:

  • core EPS of $4.78
  • organic revenue growth of ~4.0%, excluding the impact of a 53rd week and structural changes, but including the deconsolidation of its Venezuelan operations
  • productivity savings of ~$1.0 billion
  • more than $10.0 billion in cash flow from operating activities
  • free cash flow of more than $7.0 billion, excluding certain items

Next, we’ll take a look at Sonoco Products (SON).

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