PepsiCo Announces Q4 Results (PEP)
PepsiCo Inc. (NYSE: PEP) cut down its full year growth forecast. The company stock reacted negatively to the news and is currently trading at $63.22, down 1.86 percent. Pepsi gave several reasons for cutting down its estimates. The company said that it has been hit by escalating commodity prices. It also attributed the downward revision to increased investment expenditure in the emerging markets. The company also cited difficult economy as a reason.
Morning Star analyst Phil Gorham, said, “With the costs of sweeteners at multi-year highs, margin pressures are likely to remain until consumers become willing and able to bear the burden of rising costs.” The company increased its exposure to the escalating commodity costs by buying out its bottlers in North America. The company had done so to have more control over distribution.
Pepsi also provided guidance about its full year earnings. The company expects its full year earnings growth to be in the range of 7 to 8 percent, down from previously announced range of 11 to 12 percent. The company’s fourth quarter net income fell 5 percent to $1.3 billion. However, the company’s results were better than the consensus estimates. The company also said that it expects the commodity prices to increase further during 2011. The rate of increase is expected to be in the range of 8 percent to 9.5 percent.
Pepsi stock opened at $63.48 and touched the high of $64.19. The stock’s lowest price in today’s session is $62.94. The company stock’s beta is 0.54. The company stock has traded in the range of $59.51 and $68.11 during the past 52 weeks. The company’s market cap is $100.21 billion and its P/E ratio is 15.88.
Pepsi reported its total current assets at $12.571 billion for the year ending Dec 26, 2009. Its total assets were worth $39.848 billion for the same time period. Pepsi had valued its total liabilities at $23.044 billion. The company had reported its revenue at $43.232 billion and its gross profit for the year at $23.133 billion. Pepsi’s net income for the year stood at $5.946 billion.
