153.63 USD
+4.94 (+3.32%)
At close: Jan 30, 2026
153.25 USD
-0.38 (-0.25%)
After Hours: 1/30/2026, 8:12:42 PM
PEP gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 32 industry peers in the Beverages industry. While PEP belongs to the best of the industry regarding profitability, there are concerns on its financial health. PEP has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
- In the past year PEP was profitable.
- PEP had a positive operating cash flow in the past year.
- PEP had positive earnings in each of the past 5 years.
- Each year in the past 5 years PEP had a positive operating cash flow.
1.2 Ratios
- With a Return On Assets value of 6.78%, PEP perfoms like the industry average, outperforming 59.38% of the companies in the same industry.
- PEP has a Return On Equity of 37.26%. This is amongst the best in the industry. PEP outperforms 90.63% of its industry peers.
- Looking at the Return On Invested Capital, with a value of 15.32%, PEP belongs to the top of the industry, outperforming 84.38% of the companies in the same industry.
- PEP had an Average Return On Invested Capital over the past 3 years of 15.79%. This is above the industry average of 11.62%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.78% | ||
| ROE | 37.26% | ||
| ROIC | 15.32% |
ROA(3y)9.44%
ROA(5y)8.85%
ROE(3y)51.36%
ROE(5y)50.9%
ROIC(3y)15.79%
ROIC(5y)14.66%
1.3 Margins
- With a Profit Margin value of 7.82%, PEP perfoms like the industry average, outperforming 56.25% of the companies in the same industry.
- In the last couple of years the Profit Margin of PEP has remained more or less at the same level.
- The Operating Margin of PEP (15.49%) is better than 68.75% of its industry peers.
- PEP's Operating Margin has been stable in the last couple of years.
- PEP has a Gross Margin of 54.50%. This is in the better half of the industry: PEP outperforms 65.63% of its industry peers.
- In the last couple of years the Gross Margin of PEP has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.49% | ||
| PM (TTM) | 7.82% | ||
| GM | 54.5% |
OM growth 3Y3.85%
OM growth 5Y0.2%
PM growth 3Y2.85%
PM growth 5Y-0.86%
GM growth 3Y1.08%
GM growth 5Y-0.08%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), PEP is creating value.
- The number of shares outstanding for PEP remains at a similar level compared to 1 year ago.
- PEP has less shares outstanding than it did 5 years ago.
- Compared to 1 year ago, PEP has a worse debt to assets ratio.
2.2 Solvency
- PEP has an Altman-Z score of 3.63. This indicates that PEP is financially healthy and has little risk of bankruptcy at the moment.
- With a decent Altman-Z score value of 3.63, PEP is doing good in the industry, outperforming 65.63% of the companies in the same industry.
- PEP has a debt to FCF ratio of 7.49. This is a slightly negative value and a sign of low solvency as PEP would need 7.49 years to pay back of all of its debts.
- Looking at the Debt to FCF ratio, with a value of 7.49, PEP is in line with its industry, outperforming 56.25% of the companies in the same industry.
- A Debt/Equity ratio of 2.28 is on the high side and indicates that PEP has dependencies on debt financing.
- PEP has a Debt to Equity ratio of 2.28. This is amonst the worse of the industry: PEP underperforms 90.63% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.28 | ||
| Debt/FCF | 7.49 | ||
| Altman-Z | 3.63 |
ROIC/WACC1.95
WACC7.84%
2.3 Liquidity
- A Current Ratio of 0.91 indicates that PEP may have some problems paying its short term obligations.
- PEP has a worse Current ratio (0.91) than 75.00% of its industry peers.
- A Quick Ratio of 0.72 indicates that PEP may have some problems paying its short term obligations.
- Looking at the Quick ratio, with a value of 0.72, PEP is in line with its industry, outperforming 46.88% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.91 | ||
| Quick Ratio | 0.72 |
3. Growth
3.1 Past
- PEP shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -1.63%.
- The Earnings Per Share has been growing by 8.13% on average over the past years. This is quite good.
- PEP shows a small growth in Revenue. In the last year, the Revenue has grown by 0.49%.
- PEP shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 6.46% yearly.
EPS 1Y (TTM)-1.63%
EPS 3Y9.3%
EPS 5Y8.13%
EPS Q2Q%-0.87%
Revenue 1Y (TTM)0.49%
Revenue growth 3Y4.94%
Revenue growth 5Y6.46%
Sales Q2Q%2.65%
3.2 Future
- PEP is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 3.75% yearly.
- The Revenue is expected to grow by 2.97% on average over the next years.
EPS Next Y0.42%
EPS Next 2Y2.84%
EPS Next 3Y3.8%
EPS Next 5Y3.75%
Revenue Next Year1.4%
Revenue Next 2Y2.62%
Revenue Next 3Y2.82%
Revenue Next 5Y2.97%
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 19.57, PEP is valued on the expensive side.
- PEP's Price/Earnings ratio is in line with the industry average.
- PEP's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.30.
- A Price/Forward Earnings ratio of 17.80 indicates a rather expensive valuation of PEP.
- PEP's Price/Forward Earnings ratio is in line with the industry average.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.57, PEP is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.57 | ||
| Fwd PE | 17.8 |
4.2 Price Multiples
- PEP's Enterprise Value to EBITDA is on the same level as the industry average.
- PEP's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.95 | ||
| EV/EBITDA | 13.87 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- PEP has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)46.11
PEG (5Y)2.41
EPS Next 2Y2.84%
EPS Next 3Y3.8%
5. Dividend
5.1 Amount
- PEP has a Yearly Dividend Yield of 3.94%. Purely for dividend investing, there may be better candidates out there.
- Compared to an average industry Dividend Yield of 1.66, PEP pays a better dividend. On top of this PEP pays more dividend than 93.75% of the companies listed in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, PEP pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.94% |
5.2 History
- The dividend of PEP is nicely growing with an annual growth rate of 6.80%!
- PEP has paid a dividend for at least 10 years, which is a reliable track record.
- PEP has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)6.8%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
- PEP pays out 104.55% of its income as dividend. This is not a sustainable payout ratio.
- The dividend of PEP is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP104.55%
EPS Next 2Y2.84%
EPS Next 3Y3.8%
PEPSICO INC / PEP FAQ
Can you provide the ChartMill fundamental rating for PEPSICO INC?
ChartMill assigns a fundamental rating of 4 / 10 to PEP.
Can you provide the valuation status for PEPSICO INC?
ChartMill assigns a valuation rating of 3 / 10 to PEPSICO INC (PEP). This can be considered as Overvalued.
Can you provide the profitability details for PEPSICO INC?
PEPSICO INC (PEP) has a profitability rating of 7 / 10.
What are the PE and PB ratios of PEPSICO INC (PEP) stock?
The Price/Earnings (PE) ratio for PEPSICO INC (PEP) is 19.57 and the Price/Book (PB) ratio is 10.83.
How sustainable is the dividend of PEPSICO INC (PEP) stock?
The dividend rating of PEPSICO INC (PEP) is 6 / 10 and the dividend payout ratio is 104.55%.