What to Look for When PepsiCo (PEP) Reports Q3 Earnings - TheStreet

NEW YORK (TheStreet) -- Shares of PepsiCo (PEP) - Get Report were higher in late-morning trading on Tuesday ahead of the company's 2016 third quarter results, due out before Thursday's opening bell.

Analysts are expecting earnings and revenue to decline year-over-year.

Wall Street is forecasting that the Purchase, NY-based beverage and food company will post earnings of $1.32 per share on revenue of $15.83 billion.

During the same quarter a year ago, PepsiCo earned $1.35 per share on revenue of $16.33 billion.

The company's brands include Frito-Lay, Gatorade, Pepsi-Cola, Quaker and Tropicana.

Deutsche Bank has a "buy" rating and $120 price target on the stock ahead of the quarterly report.

"While scanned channel trends have decelerated slightly in US salty snacks in the most recent period...we believe the company's foodservice and health/wellness oriented products in specialty and unscanned channels could drive upside," the firm wrote in an analyst note.

Deutsche Bank continues to see upside to earnings with "decent" organic growth prospects, which should allow the company to further close the valuation gap to others in the group.

(PepsiCo is held in Jim Cramer's charitable trust Action Alerts PLUS. See all of his holding with a free trialhere.)

Separately, TheStreet Ratings Team has a "Buy" rating with a score of A on the stock.

The company's strengths can be seen in multiple areas, such as its solid stock price performance, increase in net income, notable return on equity, expanding profit margins and good cash flow from operations.

The team believes its strengths outweigh the fact that the company has had generally high debt management risk by most measures that were evaluated.

Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.

You can view the full analysis from the report here: PEP

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