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Now that the current earnings season has officially gotten under way, we are going to have our hands full keeping track of all the big names. PepsiCo Inc. (NYSE: PEP) is going to get its shot at impressing investors tomorrow when it reports its third quarter earnings before the market opens.
The company has not given us any guidance as to what we can expect, but Wall Street analysts are expecting to see the company come through with earnings of 96 cents per share, and revenues of $9.9 billion. The last time the company reported earnings was back on July 24 when it surprised to the upside by reporting 94 cents per share, five cents higher than analysts were predicting.
If the company is able to beat estimates tomorrow morning, it will be the sixth straight quarter in a row of above-estimate earnings. In fact, PepsiCo has only reported earnings underestimates one time in the past 15 earnings announcements -- in Q1 2006 the company failed to hit its estimates of 58 cents a share by only reporting 56 cents for the quarter.
Not all analysts are placing their bets on PepsiCo. The stock was downgraded on Tuesday by Deutsche Bank from a "buy" to a "hold." Deutsche also gave PepsiCo's main competitor, Coca Cola (NYSE: KO) a similar downgrade, stating that the companies had enjoyed a great run, but now was time to take profits, and that both companies could fall victim to higher raw material and packaging costs that may hurt the companies in the near term.
Shares are trading up today ahead of tomorrow's announcement. In mid-day trading the stock has traded up 1.2% to $74.09, up $0.84.
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