Consumer Nation
- Longer Lines, Fuller Carts This Black Friday
- EA Sports Hopes to Pump Up Sales Through Pop-Up Locations
- Consumers Catching the Holiday Spirit
- Blue Jeans Expected to See Another Green Christmas
- Holiday Tipping: Who And How Much
- Deep Discounts Should Make It a Very Tech-y Holiday
- This Holiday Season—Little Joy For Those Hard Hit
- Victoria's Secret Hopes to Rekindle Desire for Lingerie
- Consumers Feel Guilty: JC Penney CEO
- Mixed Signals Come From Retail Sector as Holidays Draw Near
RSS FEED
MOST SHARED
- Tiger Woods Out of Hospital After Accident
- The Good Entrepreneur Winner
- Halftime Report: Dubai - First Ripple Of Larger Crisis?
- Global Selloff From Dubai Woes Shows Signs of Winding Down
- Next Week: Cash In Now Or Wait For A Santa Rally?
- Get Paid Six Figures to Wear a T-Shirt?
- Dubai Spooks Investors But May Bring Buying Opportunity
- U.S. Stocks Fall on Dubai Worries
- Black Friday at Best Buy
- Strategists on Dubai: Avoid 'Rash Moves' Now
- Longer Lines, Fuller Carts This Black Friday
- Dubai Stock Market Fear Has 'Legs': Dennis Gartman
- Obama's Emission Reduction Pledge Paints Future for Autos
- Is Super Bowl Halftime Act Too Old?
- Surprising Options Trades in TiVo Shares
- EA Sports Hopes to Pump Up Sales Through Pop-Up Locations
- Dubai's Debt Woes Signal New Era for Creditors
- Next Week: Cash In Now Or Wait For A Santa Rally?
- Fed Audit Would Hurt Economic Prospects: Bernanke
- Dubai Stock Selloff May Bring Buying Opportunity
- Longer Lines, Fuller Carts This Black Friday
- Big US Banks May Be Forced to Raise Capital: Bove
- Bank of America Amends Pay for Senior Executives
- Dubai Fallout Is a Correction, Not Another Crisis: El-Erian
- Tiger Woods Out of Hospital After Accident
Text Size 
News Editor
PepsiCo shares rallied Friday as the beverage company inched closer to the dawn of a new Pepsi generation.
 |
Photo: Mashroms At least one analyst says the current Wall Street consensus estimate for PepsiCo is still too low. |
Pepsi [PEP
Loading...
()
] filed proxies connected with its planned acquisitions of its two largest bottlers, Pepsi Bottling Group [PBG
Loading...
()
] and PepsiAmericas [PAS
Loading...
()
].
The proxies, which did not include a provision for a "material adverse change," imply that Pepsi will likely go ahead with an acquisition even if regulators force Pepsi to terminate distribution relationships with Dr Pepper Snapple Group [DPS
Loading...
()
]. According to analysts, this was a concern that was weighing on Pepsi shares in recent weeks.
In addition, there were positive comments from analysts. Barclays' consumer staples team moved Pepsi to the No. 1 spot on its "Favorites" list, and Deutsche Bank increased its estimate for Pepsi's 2010 earnings, citing lower projections for the cost of interest and depreciation for the new forecast. Deutsche Bank analyst Marc Greenberg now expects earnings to be $4.20 a share, about 4 cents higher than his prior estimate for next year's earnings.
Analysts polled by Thomson Reuters had estimated earnings of $4.10 a share.
In a research note, Stifel Nicolaus analyst Mark Swartzberg said he suspects the Wall Street consensus for PepsiCo is still too low, and he expects projected earnings growth will accelerate materially before the year's end.
His estimate currently stands a penny below Greenberg's at $4.19 a share.
Pepsi is expected to close its acquisition of the bottlers in either late 2009 or early 2010.
Although the proxies seem to indicate a strong commitment to get the deal done regardless of the relationship with Dr Pepper, it is still a significant relationship for PepsiCo, Swartzberg said.
Swartzberg expects Dr Pepper to try to use the situation to negotiate a better deal with Pepsi, but not remove all of its volume from the Pepsi system.
This could improve the economics for Dr Pepper, and as a result, Swartzberg raised its price target for Dr Pepper to $32.
More from Consumer Nation:
- Toymakers Stress Value for the Holidays
- Stingy Santa Is Coming Back This Holiday Season
- Will a $10 Hamster Have Them Fighting in the Aisles?
Questions? Comments? Email us at
Data is a real-time snapshot *Data is delayed at least 15 minutes