Market Overview

Alcoa, PepsiCo Kick Off Q3 Earnings Season

Alcoa, PepsiCo Kick Off Q3 Earnings Season
  • The third-quarter earnings reporting period kicks off this week.
  • PepsiCo, Yum Brands and Alcoa are first into the third-quarter earnings spotlight.
  • Monsanto is also expected to share its latest results this week.

The new earnings season begins this week, providing a look at how companies fared in the period when China's economic slowdown and uncertainty about interest rate hikes from the Federal Reserve shook the markets , introducing more volatility than many investors were used to.

First into the third-quarter earnings spotlight are Alcoa Inc (NYSE: AA), PepsiCo, Inc. (NYSE: PEP) and Yum! Brands, Inc. (NYSE: YUM). If the forecasts are any kind of sign about things to come, then it could be a rough quarter, as expectations for two of these three are low, both for top-line and bottom-line results.

Fiscal quarterly results from Monsanto Company (NYSE: MON) will be another highlight this week. Here the Wall Street forecast for quarterly earnings has shifted in the past 60 days from a small per-share profit to a net loss.

Below is a quick look at what is expected from these and a few of the week's other most prominent reports, as well as a peek at what is coming up as the new earnings season ramps up.

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This leading aluminum producer will post earnings of $0.18 per share for its third quarter, if Estimize's consensus forecast is accurate. That would be down from $0.31 in the same period of last year. Note that Estimize overestimated Alcoa earnings in the previous period.

The 69 Estimize survey respondents see revenue for the three months that ended in September having fallen to $5.78 billion from $6.24 billion in the year-ago quarter. Wall Street analysts are looking for just $5.69 billion in sales. Watch for the Alcoa to report after Thursday's closing bell.


In its report early Wednesday, this agricultural biotech giant is expected to say that its earnings per share (EPS) came to $0.06 for the period that ended in August. That compares to a net loss of $0.02 per share expected by Wall Street, and the net loss of $0.27 per share posted in the year-ago period.

The consensus of 21 Estimize estimates has revenues at $2.89 billion for the fiscal fourth quarter, a bit higher than Wall Street expectations for $2.77 billion. That would be up from the $2.63 billion posted in last year's quarter. Note that the Wall Street forecast has full-year revenue down almost 3 percent.


The third-quarter forecast for this beverage and snack titan calls for EPS to have slipped from $1.36 in the year-ago period to $1.30, according to 33 Estimize respondents. Also, revenue is expected to have retreated more than 5 percent to $16.30 billion for the three months that ended in September.

The Wall Street forecast calls for $1.27 per share and $16.22 billion in sales for the quarter. Note that bottom-line results topped the consensus expectations of Estimize in the previous period. PepsiCo is scheduled to release its results Tuesday before the regular trading session commences.

Yum Brands

When it shares its results late Tuesday, the consensus of 33 Estimize estimates is that this operator of Pizza Hut and Taco Bell will show earnings of $1.10 per share. That would be up from $0.87 per share in the same period of last year. Both Estimize and Wall Street underestimated EPS in the past two quarters.

Revenue for the three months that ended in September will be around 10 percent higher than a year ago to $3.73 billion, if Estimize is correct. Wall Street is a bit more pessimistic, with a $3.67 billion forecast. Note that they both underestimated sales back in the second quarter.

See also: Why T-Mobile Trumps Sprint In The Investing World

And Others

Among the few other companies expected to report this week, Wall Street anticipates seeing year-on-year EPS gains from Acuity Brands, Constellation Brands and Domino's Pizza. But they foresee a smaller profit from Container Store and Helen of Troy, and a net loss is forecast for International Speedway.

As mentioned, the third-quarter earnings season gathers momentum the following week. Big banks such as Bank of America, Citigroup, JPMorgan and Wells Fargo are expected to report, and at least some year-on-year earnings growth is expected from all four. But Wall Street's expectations are muted for earnings from the likes of General Electric, Intel, Johnson & Johnson, Netflix, Philip Morris and Schlumberger when they share their latest results.

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Posted-In: Alcoa Monsanto pepsicoEarnings News Previews Pre-Market Outlook Trading Ideas Best of Benzinga


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