Pepsi's stock jumps 3% as higher advertising spending fuels sales growth and earnings beat - CNBC

A woman grabs a bottle of Diet Pepsi in Atlanta, Georgia.

Chris Rank | Bloomberg | Getty Images

PepsiCo on Thursday announced quarterly earnings and revenue that topped expectations, as its increased spending on advertising and marketing paid off for brands like Gatorade.

Shares of the food and beverage giant jumped 3% in premarket trading.

"Given our performance year-to-date, we now expect to meet or exceed our full-year organic revenue growth target of 4%," CEO Ramon Laguarta said in a statement.

The company reaffirmed its earnings outlook for fiscal 2019. It expects adjusted earnings per share, assuming constant foreign currency exchange rates, to decline by 1%.

Here's what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

• Earnings per share: $1.56, adjusted, vs. $1.50 expected
• Revenue: $17.19 billion vs. $16.93 billion expected

Pepsi reported fiscal third quarter net income of $2.1 billion, or $1.49 per share, down from $2.5 billion, or $1.75 per share, a year earlier. The company's strategy for sales growth includes investing more on marketing and advertising its products.

Excluding the impact of foreign exchange, restructuring charges and other items, Pepsi earned $1.56 per share, topping the $1.50 per share expected by analysts surveyed by Refinitiv.

Net sales rose 4.3% to $17.19 billion, topping expectations of $16.93 billion.

Frito Lay North America, which includes brands like Cheetos and Doritos, saw revenue growth of 5.5%. Pepsi has been expanding its snack lineup with healthier options, through brands like Bare and Off the Eaten Path. Revenue growth from those healthier snacks and well-known chip brands helped offset the double-digit sales declines of Sabra hummus and guacamole dips. Pepsi owns a 50% stake of the hummus maker through a joint venture with Strauss Group.

Its North American beverage business also performed well, with 3.5% revenue growth. Gatorade improved its market share and saw positive net revenue growth during the quarter. The brand's no-sugar line, Gatorade Zero, which launched in May 2018, surpassed a half-billion dollars in retail sales.

Bubly, which the company expects will be one of its next billion dollar brands, is continuing to gain market share in the flavored sparkling water category against competitors like La Croix.

Pepsi's organic revenue also grew by 4.3% during the quarter.

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2019-10-03 10:45:47Z
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PepsiCo, Constellation Brands, Costco earnings — What to know in markets Thursday - Yahoo Finance

Markets have been off to a rocky start to kick off October and the fourth quarter. Three key earning reports — beverage giant PepsiCo (PEP), beer brand Constellation Brands (STZ) and big-box retailer Costco (COST) — could help boost stocks Thursday.

Ahead of the opening bell, PepsiCo and Constellation Brands take the spotlight.

Analysts are predicting that PepsiCo’s Frito-Lay North America business strength continued in the third quarter. Snacks have been the bright spot for the beverage giant over recent quarters. Though the beverage business has been underperforming snacks, analysts expect the North American beverages segment to show a bit of improvement. Investors will be paying close attention to full-year earnings and revenue guidance.

PepsiCo is expected to report adjusted earnings of $1.50 per share on $16.93 billion in sales, according to analysts polled by Bloomberg. Organic sales are projected to have grown 3.4% during the quarter. Frito-Lay North America is expected to have risen 5%, while 1.75% growth is anticipated for Beverages North America.

Corona beer bottles seen on the store shelf (Photo by Igor Golovniov/SOPA Images/LightRocket via Getty Images)

Constellation Brands will release fiscal second-quarter results and is expected to report adjusted earnings of $2.63 per share on $2.34 billion of revenue. Last month, the company said its Q2 results would include a $38.5 million net loss from its investment in Canopy Growth (CGC). Nevertheless, Constellations beer sales will be the focal point for investors and analysts.

Second quarter beer net sales are estimated to have totaled $1.64 billion and shipment volume is expected to have reached 92.97 million cases, up from 82.1 million cases in the first quarter. The options market is implying a nearly 6% move in either direction following Constellations earnings report.

Meanwhile, after the closing bell, retail giant Costco will release its fiscal fourth quarter financial results. Costco’s strong same-store sales momentum is expected to have continued in Q4. Excluding fuel and the impact of foreign exchange, same-store sales in the U.S. are expected to have risen 5.4% and 5.7% in Canada and international markets, respectively, according to Bloomberg-compiled estimates. Furthermore, strong loyalty among customers likely boosted membership revenue by 5.3% during the quarter. The retailer is expected to report adjusted earnings of $2.54 per share on $47.70 billion in revenue.

The ongoing trade war and U.S. tariffs on Chinese goods continues to be a concern for retailers. Investors will be paying attention to any additional commentary regarding the tariffs. Costco has been crushing its competitors. Shares have skyrocketed a whopping 40% this year, while Walmart (WMT) jumped 26%, and BJ’s Wholesale Club (BJ) rose 12% in the same time period.

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Heidi Chung is a reporter at Yahoo Finance. Follow her on Twitter: @heidi_chung.

More from Heidi:

• Nestlé-owned Sweet Earth launches plant-based Awesome Burger

• Beyond Meat vs. Impossible Foods: Burger nutrition showdown

• McDonald's enters the chicken sandwich wars — and it's no Popeyes

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2019-10-03 09:49:00Z
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Asian stocks slide as U.S. tariffs on EU fan growth worries - Investing.com

© Reuters. FILE PHOTO: The German share price index DAX graph at the stock exchange in Frankfurt

By Karin Strohecker

LONDON (Reuters) - World stocks hovered near four-week lows on Thursday and yields on major benchmark bonds slipped after Washington moved to impose new tariffs on European goods, fuelling fears about global growth and dousing risk appetite.

MSCI's index of world stocks () slipped 0.1%, with Asian shares plunging. Japan's Nikkei stock index () closing down 2%, its biggest one-day decline since Aug. 26.

However, European stocks eked out small gains after suffering their worst day since last December on Wednesday, when the U.S. got the go-ahead to impose tariffs on $7.5 billion of European goods.

Washington will enact 10% tariffs on Airbus (PA:) planes and 25% duties on French wine, Scotch and Irish whiskies and cheese from across the continent as punishment for illegal EU subsidies to Airbus.

But a reduction in the initial list propped up some sectors with the pan-regional STOXX 600 index () up 0.2%, torn between falls in financials and gains in luxury goods stocks. France's CAC index () rose 0.7% while Britain's FTSE 100 () fell 0.5%. German bourses - a weather vane for exports - were closed for a national holiday.

The latest U.S.-European trade tensions added to fears over the standoff between Washington and Beijing, which has cast a shadow over global growth prospects. Earlier in the week, disappointing data on U.S. manufacturing and the jobs market suggested the trade war with China had damaged the world's largest economy.

"The big question for a lot of folks is whether this is the third slowdown since the financial crisis or are we now heading for a global recession," said Anujeet Sareen, a fixed income portfolio manager and global macro strategist for Brandywine Global. "The wild card in the pack is always Donald Trump and whatever he tweets next."

U.S. stock futures () () indicated 0.4% higher, after shares fell the most in nearly six weeks on Wednesday. All three major New York share indexes lost more than 1.5%.

"Risk aversion is broadly on the rise and that has been triggered by the weakness in U.S. manufacturing ISM data earlier this week," said Manuel Oliveri, an FX strategist at Credit Agricole (PA:) in London.

"The outperformance of the U.S. economy compared to other major economies has held the dollar and other risky assets up but that has changed this week."

The flight to safety saw yields on two-year U.S. Treasury yields () slip to 1.4680%, nearing a two-year low of 1.4280%. Adding to pressure on yields was a weak U.S. jobs report, boosting expectations the Federal Reserve will cut interest rates this month.

Traders see a 72.8% chance the Fed will cut rates by 25 basis points to 1.75%-2.00% in October, up from 39.6% on Monday, according to CME Group's FedWatch tool.

Bets on a rate cut could rise further if a U.S. non-farm payrolls report on Friday shows weakness in the labor market.

Government bond yields in safe-haven Germany () fell for the first time in over a week.

In currency markets, the dollar dipped to one-week lows against the euro and yen. The greenback crossed 107 Japanese yen and touched a week low of 106.95 yen before recovering some ground. It fell to $1.0973 per euro (). The () slipped 0.1%.

Meanwhile, sterling was flat at $1.2306 as investors waited for a European Union response to Britain's latest Brexit offer, which Prime Minister Boris Johnson offered on Wednesday.

So far, the last-ditch Brexit proposal has received a cool reception. One senior EU official said it "can't fly" because it was an unworkable move backwards that left Britain and the EU far apart.

Brent crude () was flat at $57.84 per barrel. Energy traders are worried about a slowing global economy, an over-supplied market and geopolitical friction in the Middle East.

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2019-10-03 06:57:00Z
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Tesla's Model Y: This Could Be The Company's Most Profitable Vehicle - Seeking Alpha

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1. Tesla's Model Y: This Could Be The Company's Most Profitable Vehicle  Seeking Alpha
2. Tesla delivers a record 97,000 vehicles in third quarter, falling short of forecasts  CNBC
3. Tesla delivery numbers fall short of Musk's 100,000 target  CNN
4. Tesla Breaks Another Record, But Did It Break Even?  Bloomberg
5. Stocks To Watch: Sysco Flashes A Second Chance Buy Point  Investor's Business Daily
6. View full coverage on Google News

https://seekingalpha.com/article/4294721-teslas-model-y-companys-profitable-vehicle

2019-10-03 05:07:00Z
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Stock market news: October 2, 2019 - Yahoo Finance

U.S. stocks were on track to extend declines Wednesday after a weak batch of economic data sparked concerns over the pace of global and domestic growth.

Here were the main moves in the pre-market session, as of 8:24 a.m. ET:

• S&P 500 futures (ES=F): -0.38%, or 11.25 points

• Dow futures (YM=F): -0.4%, or 107 points

• Nasdaq futures (NQ=F): -0.47%, or 36.25 points

• U.S. crude oil prices (CL=F): +0.8% to $54.05 per barrel

• 10-year Treasury yield (^TNX): -0.5 bps to 1.639%

• Gold (GC=F): +0.2% to $1,492.00 per ounce

On Wednesday, ADP/Moody’s monthly jobs report showed private payrolls rose by 135,000 in September, marking the slowest gain since June and coming in below expectations for a gain of 140,000, according to consensus economists polled by Bloomberg. August’s headline private payrolls figure was downwardly revised to show at gain of 157,000, from a gain of 195,000 previously reported.

The new reports brought the 2019 monthly average down to 145,000, versus an average of 214,000 by this time last year. The Department of Labor will post its “official” print on U.S. payroll gains in September on Friday.

This adds to the deluge of disappointing data that sparked Tuesday’s global growth scare and risk-off session in the markets. The Institute for Supply Management on Tuesday posted a report showing U.S. manufacturing activity fell to the lowest level since June 2009 in September. This data was coupled with a print from IHS Markit showing eurozone manufacturing activity fell to the lowest since October 2012. And IHS Markit’s global manufacturing purchasing managers’ index showed the sector contracting for a fifth consecutive month.

ADP/Moody’s private payrolls report reflected this weakness in manufacturing sector employment. In production-related industries, construction jobs rose by 9,000 and manufacturing positions increased by 2,000 during the month. However, natural resources and mining jobs lost 3,000 payrolls.

Economists broadly pointed to the U.S.-China trade war as cause for the deterioration in the trade-sensitive goods-producing sector, even as President Donald Trump used the weak data to renew his attack on the Federal Reserve and call for lower rates to spur growth.

“Global trade remains the most significant issue, as demonstrated by the contraction in new export orders that began in July 2019,” Timothy Fiore, chair of the ISM survey committee, said in a statement of the U.S. economic results. “Overall, sentiment this month remains cautious regarding near-term growth.”

While manufacturing activity comprises only about 11% of domestic GDP, according to a recent Goldman Sachs report, the sector’s measurable deceleration this year has become a paragon for the impact of ongoing trade tensions.

Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., September 18, 2019. REUTERS/Brendan McDermid

Independently, other portions of the domestic economy have firmed, with positive quarterly earnings results from homebuilder Lennar (LEN) on Wednesday underscoring strengthening demand in the housing market as mortgage rates decline. Last week, a 30-year fixed rate mortgage fell to 3.64%, down from 4.72% a year earlier, according to Freddie Mac. During the same period, mortgage applications rose by 8.1%, the Mortgage Bankers Association said Wednesday.

Lennar said contracts to purchase homes increased 9% during the quarter ending in August, far exceeding consensus analyst expectations for a 3.5% rise. Quarterly financial results were a beat on both the top and bottom lines, with adjusted earnings of $1.59 per share exceeding expectations for $1.32, and sales of $5.86 billion topping expectations for $5.47 billion.

“Our second quarter results benefited from both first quarter deliveries postponed by weather as well as a recovering housing market,” Lennar CEO Stuart Miller said in a statement. “The well-documented market pause in the second half of 2018 set the stage for more moderate home price increases and lower interest rates which stimulated both affordability and demand, leading homebuyers back to the market.”

Lennar’s results come on the heels of a strong reading for new-home sales, with the Commerce Department reporting last week that single-family home sales climbed 7.1% to an annualized pace of 713,000 in August, far exceeding forecasts.

Mark your calendars!

—

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck

Read more from Emily:

• FedEx CEO: ‘Whistling past the graveyard’ on the U.S. consumer belies a broader slowdown

• There won’t be ‘billion-dollar beverage brands’ in the future: Iris Nova CEO

• Coca-Cola products are ‘out of touch with the modern consumer,' founder of Coca-Cola backed beverage co. says

• Iris Nova CEO calls his company the ‘Netflix’ of the beverage space

• Tech companies like Lyft want your money – not ‘your opinion’

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2019-10-02 12:27:00Z
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Tesla relaunches Model 3 key fob and fixes major drawback - Electrek

Tesla is relaunching its Model 3 key fob a year after first introducing it, and the company appears to finally have fixed its major drawback of not having passive entry.

Model 3 owners are meant to use their phones as the main way to unlock their cars.

Tesla also gives key cards, but the user experience is designed around the phone and Tesla’s mobile app.

In my experience, it works very well, but some owners have been requesting a more traditional key fob, which Tesla already uses with Model S and Model X.

It seems to be a problem in particular with a few Android phones, and it’s enough of an issue that a majority of Electrek readers said in a previous poll they would prefer a key fob for the Model 3.

In November 2018, Tesla finally launched a key fob for the Model 3, but the company said that it didn’t support passive entry, making it a lot less useful.

Passive entry enables owners to just walk up to the car and it will unlock, a feature that is already available through the phone app.

Stocks have been limited for the new key fob, and recently, Tesla shut down the page on its online shop.

Tesla has now relaunched the Model 3 key fob and the new description appears to confirm that it is now capable of passive entry:

No hands required. Locking and unlocking your Model 3 has never been easier. Keep your key fob in your pocket and simply pull on the door handle for easy entry. Same with the trunk. Your key fob is automatically enabled when you pair with your vehicle.

Now that Tesla is reintroducing the Model 3 key fob with passive entry, are you going to get one or keep using your phone?

Passive entry comes with some safety risks when it comes to theft, but Tesla made several updates lately to address the situation after a series of thefts in Europe using relay attacks.

In the past, Tesla also shared tips to prevent relay attacks, which also affect other vehicles with key fobs, including keeping your key fob in a small Faraday cage or pouch at home.

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2019-10-02 11:48:00Z
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In Opioid Settlement, Johnson & Johnson Agrees To Pay Ohio Counties $20 Million - NPR

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Akron fire medic Paul Drouhard shows a box containing Naloxone Hydrochloride, a drug carried in all their department emergency response vehicles to treat opioid overdose patients. Keith Srakocic/AP hide caption

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Keith Srakocic/AP

Johnson & Johnson and two Ohio counties have reached a tentative $20.4 million settlement that removes the corporation from the first federal lawsuit against opioid manufacturers, scheduled to begin later this month.

In a statement released Tuesday, the healthcare giant said the agreement with Cleveland's Cuyahoga and Akron's Summit counties allows it "to avoid the resource demands and uncertainty of a trial." However, the terms stipulate that Johnson & Johnson makes "no admission of liability."

"[The] Company is open to identifying an appropriate, comprehensive resolution of the overall opioid litigation. At the same time, the Company remains prepared to defend its actions," the statement said.

In a deal which must be approved by a federal judge, Johnson & Johnson agreed to pay the counties a total of $10 million and to reimburse them for $5 million in legal fees. An additional $5.4 million would go toward programs to fight opioid addiction in the two counties.

In 2017, Ohio had the nation's second highest per capita rate of fatal opioid overdoses, with 46.3 deaths per 100,000 people, according to the Centers for Disease Control and Prevention. West Virginia had the highest rate at 57.8 per 100,000, the CDC said.

Janssen Pharmaceuticals, a subsidiary of Johnson & Johnson, made two opioids that were distributed in Cuyahoga and Summit counties. Johnson & Johnson says the drugs were "responsibly marketed" and "accounted for less than one percent of the total opioid prescriptions in the United States."

In August, the drug maker was ordered to pay $572 million in a case in Oklahoma, which blamed Johnson & Johnson for helping fuel the opioid crisis in the state. The company has appealed the ruling.

Judge Thad Balkman, who presided over the Oklahoma case, said the pharmaceutical giant "caused an opioid crisis that is evidenced by increased rates of addiction, overdose deaths and neonatal abstinence syndrome" in the state.

The case involving the Ohio counties is the first federal case to be brought against pharmaceutical companies and is therefore seen as potentially setting precedent for how similar suits will be handled.

Four other drug makers have already settled ahead of the Oct. 21 trial, but McKesson Corp., AmerisourceBergen, Cardinal Health, Teva Pharmaceutical Industries Ltd., Walgreens Boots Alliance Inc. and Henry Schein Inc. are still listed as defendants, according to Reuters.

The maker of OxyContin, Purdue Pharma, which filed for Chapter 11 bankruptcy last month, has reached a tentative settlement in the Ohio suit worth some $12 billion.

Johnson & Johnson, like the other drug makers, still faces some 2,000 other suits in various states related to the opioid epidemic.

Early next year, a similar case brought by West Virginia's Cabell County and the city of Huntington — which have the highest opioid overdose rates in the country — is set to be taken up.

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2019-10-02 09:41:00Z
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