Dr Pepper Snapple Group Inc.
) is set to report first quarter 2013 results on Apr 24. Last
quarter it posted a 4.71% negative surprise. Let's see how things
are shaping up for this announcement.
Factors in this Past Quarter
Dr Pepper posted dismal results for the fourth quarter of
2012, missing the Zacks Consensus Estimates for both revenues and
earnings. Earnings declined year over year as decent sales growth
was offset by weak profits.
During the fourth quarter, Dr Pepper's net sales grew 2% year
over year as gains from price/mix and currency were offset by
lower volumes. Sales volume was down due to declines in the
Beverage Concentrates and Packaged Beverages segments. Overall,
sales were down from both the second and third quarter levels.
Adjusted operating income declined in the quarter due to planned
increase in labor and benefits. Operating income was also hurt
due to higher cost of apples used in Mott's apple juice.
Our proven model does not conclusively show that Dr Pepper is
likely to beat earnings this quarter. That is because a stock
needs to have both a positive Earnings ESP (Read:
Zacks Earnings ESP: A Better Method
) and a Zacks Rank of #1, 2 or 3 for this to happen. That is not
the case here as you will see below.
Negative Zacks ESP:
This is because the Most Accurate Estimate stands at 46 cents
while the Zacks Consensus Estimate is at 47 cents. That is a
difference of -2.13%.
Zacks Rank #4 (Sell):
Dr Pepper carries Zacks Rank #4 (Sell). We caution against stocks
with Zacks Ranks #4 and #5 (Sell rated stocks) going into the
earnings announcement, especially when the company is seeing
negative estimate revisions momentum.
Other Stocks to Consider
Here are some other companies from the consumer staple sector
you may want to consider as our model shows they have the right
combination of elements to post an earnings beat this quarter:
Flower Foods Inc
), Earnings ESP of +4.88% and Zacks Rank #1 (Strong Buy).
The Hillshire Brands Co.
), Earnings ESP of +18.75% and Zacks Rank #2 (Buy).
Molson Coors Brewing Co.
), Earnings ESP of +2.86% and Zacks Rank #3 (Hold).
DR PEPPER SNAPL (DPS): Free Stock Analysis
FLOWERS FOODS (FLO): Free Stock Analysis
HILLSHIRE BRAND (HSH): Free Stock Analysis
MOLSON COORS-B (TAP): Free Stock Analysis
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