Shares of PepsiCo Inc. PEP, +0.02% rallied 1.5% into record territory in premarket trading Tuesday, after the beverage and snacks company reported second-quarter profit and revenue that rose well above expectations and provided an upbeat full-year outlook. Net income grew to $2.36 billion, or $1.70 a share, from $1.65 billion, or $1.18 a share, in the year-ago period. Excluding nonrecurring items, adjusted earnings per share came to $1.72, above the FactSet consensus of $1.53. Revenue increased 20.5% to $19.22 billion, beating the FactSet consensus of $17.96 billion. In North America, beverages revenue grew 23.9% to $6.16 billion to beat the FactSet consensus of $5.67 billion and Frito Lay revenue rose 6.5% to $4.55 billion to top expectations of $4.49 billion, while Quaker Foods revenue fell 13.4% to $575 million to miss expectations of $584.5 million. The company said it is expanding and extending its 2019 productivity plan through the end of 2026, leading the company to raise expectations for restructuring charges as part of the plan to $3.15 billion from $2.5 billion. Looking ahead, the company said it’s outlook for organic revenue and constant currency EPS growth implies a 2021 adjusted EPS outlook of $6.20, which is above the FactSet consensus of $6.09. PepsiCo’s stock, which was on track to open above the July 8 record close of $149.86, has edged up 0.8% year to date through Monday, while the SPDR Consumer Staples Select Sector ETF XLP, -0.16% has gained 3.8% and the S&P 500 SPX, +0.35% has advanced 16.7%.
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