PepsiCo Stock Earnings: PEP up slightly after earnings beat

• PepsiCo announced FQ2 earnings that beat on top and bottom lines.
• Revenue grew 5% YoY to $20.2 billion, against forecasts of $19.5 billion.
• Adjusted EPS grew 8% YoY to $1.86, above consensus of $1.74.

PepsiCo (PEP) stock has advanced 0.7% in Tuesday's premarket to $171.77 on the back of a robust earnings release for the fiscal second quarter. PepsiCo offered up adjusted earnings per share of $1.86, which beat the consensus of $1.74. Revenue of $20.2 billion also beat consensus by about $720 million. Revenue grew about 5% YoY, and adjusted EPS rose more than 8%.

“Given our year-to-date performance, we now expect our full-year organic revenue to increase 10 percent (previously 8 percent), and we continue to expect core constant currency earnings per share to increase 8 percent," said Chairman and CEO Ramon Laguarta.

Consistent with previous guidance, PepsiCo still expects the following achievements for the full-year 2022: 8% increase in core constant currency EPS; an effective tax rate of 20%, and total cash returns to shareholders of approximately $7.7 billion. The shareholder return is comprised of $6.2 billion in dividends and $1.5 billion worth of share repurchases.

PepsiCo's earnings beat did not shock the market as it normally beats consensus. The last time it missed consensus on earnings was the fourth quarter of 2022.

PepsiCo Stock Forecast: $177.24 holds price action in place

PepsiCo stock has been in an uptrend since October 2020, judging by the last time the 50-week moving average was above its 20-week counterpart. This year, however, $177.24 has been the resistance level that just will not quit. Several attempts to overtake it have failed – once in mid-January and twice in mid and late April. Stuck in the low $170s now, PEP will likely make another run at the level fairly soon.

If bulls fail once again, then PEP stock will drop to the ascending support line at $157. This support feature has been working since September 2021. A beat of $177.24 would allow PepsiCo stock to make a run at the top of the price channel near $187.

PEP weekly chart