PepsiCo is gaining ground Tuesday after it beat on both the top and bottom lines.
Solid Frito-Lay sales helped offset a decline in its North America beverage sales.
North America beverages could be key moving forward.
PepsiCo shares are up 3% Tuesday morning after the company reported better-than-expected second-quarter earnings.
The beverage and snack maker posted core earnings of $1.61 per share, topping the Wall Street consensus of $1.52. Revenue came in at $16.09 billion, edging out the $16.04 billion that was anticipated.
PepsiCo sales grew of 2.6% year-over-year despite a 1% drop in its North America beverage unit. Its Frito-Lay unit posted a 4% YoY sales growth, easily beating Wall Street's estimates of up 2.8%.
PepsiCo reiterated its full-year 2018 earnings-per-share guidance of $5.70, saying it remains "consistent with its previous guidance for 2018."
"We think a turnaround at North America will be central to the bull case for the stock," Jefferies analyst Kevin Grundy wrote in a note out to clients.
Grundy has a $103 price target on PepsiCo, roughly 6% below its current level.
PepsiCo shares are down 6.33% this year.