Stocks

PepsiCo, a food company, outperformed the major indices in April

PepsiCo Inc. (PEP) shares climbed more than 2% in April, while the S & P 500 index plunged over 9%. A good quarterly report indicating quick sales growth in practically all categories was the key to the company’s success. PepsiCo now distributes not just a popular soda but also a variety of other beverages, snacks, and morning cereals. Even though beverage sales picked up in the first quarter, it was the second and third categories that ended up being the main growth drivers.

Total sales grew by 9.3% in the first quarter of 2022. Sales of Frito-Lay snacks climbed by 14%, while sales of Quaker breakfast items increased by 11%. Beverage sales across the world were high, particularly in Latin America, where they climbed by 19%. It’s worth noting that this area saw the worst reduction in sales last year, so its return is encouraging for PepsiCo.

Earnings per share increased by 148% to $3.06 in the first quarter.The reason for this might be a rise in the price of certain goods, as well as increased logistical and employment expenses for PepsiCo. Investors’ excitement after PepsiCo’s quarterly report was likely bolstered by a higher prediction for the whole year of 2022. By the end of the year, management had increased its own growth projections from 6% to 8%.

PepsiCo also announced a 7% increase in dividends to $4.6 per share at the end of April each year. The firm has been known as one of the “Dividend Kings” since it has consistently raised dividends for the last 50 years (Dividend King). Such occurrences tend to boost investor confidence over time, which helped PepsiCo’s stock rise even while the market was trending in the other direction.

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