PEPSICO INC (PEP) Stock Fundamental Analysis
USA - NASDAQ:PEP - US7134481081 - Common Stock
143.53 USD
-0.7 (-0.49%)
143.53 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to PEP. PEP was compared to 32 industry peers in the Beverages industry. PEP scores excellent on profitability, but there are concerns on its financial health. PEP has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year PEP was profitable.
In the past year PEP had a positive cash flow from operations.
Each year in the past 5 years PEP has been profitable.
PEP had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
PEP has a better Return On Assets (7.17%) than 65.63% of its industry peers.
PEP has a Return On Equity of 40.99%. This is amongst the best in the industry. PEP outperforms 93.75% of its industry peers.
PEP has a better Return On Invested Capital (16.72%) than 87.50% of its industry peers.
The Average Return On Invested Capital over the past 3 years for PEP is above the industry average of 11.08%.
The 3 year average ROIC (15.79%) for PEP is below the current ROIC(16.72%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.17% | ||
| ROE | 40.99% | ||
| ROIC | 16.72% |
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
Looking at the Profit Margin, with a value of 8.23%, PEP is in the better half of the industry, outperforming 62.50% of the companies in the same industry.
PEP's Profit Margin has been stable in the last couple of years.
Looking at the Operating Margin, with a value of 15.63%, PEP is in the better half of the industry, outperforming 65.63% of the companies in the same industry.
PEP's Operating Margin has been stable in the last couple of years.
PEP's Gross Margin of 54.92% is fine compared to the rest 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 | 15.63% | ||
| PM (TTM) | 8.23% | ||
| GM | 54.92% |
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
PEP has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it 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.
PEP has a worse debt/assets ratio than last year.
2.2 Solvency
PEP has an Altman-Z score of 3.53. This indicates that PEP is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of PEP (3.53) is better than 62.50% of its industry peers.
PEP has a debt to FCF ratio of 7.27. This is a slightly negative value and a sign of low solvency as PEP would need 7.27 years to pay back of all of its debts.
The Debt to FCF ratio of PEP (7.27) is comparable to the rest of the industry.
PEP has a Debt/Equity ratio of 2.14. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of PEP (2.14) is worse than 90.63% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.14 | ||
| Debt/FCF | 7.27 | ||
| Altman-Z | 3.53 |
ROIC/WACC2.19
WACC7.63%
2.3 Liquidity
A Current Ratio of 0.78 indicates that PEP may have some problems paying its short term obligations.
The Current ratio of PEP (0.78) is worse than 78.13% of its industry peers.
A Quick Ratio of 0.60 indicates that PEP may have some problems paying its short term obligations.
PEP has a Quick ratio of 0.60. This is in the lower half of the industry: PEP underperforms 71.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.78 | ||
| Quick Ratio | 0.6 |
3. Growth
3.1 Past
The earnings per share for PEP have decreased by -0.63% in the last year.
Measured over the past years, PEP shows a quite strong growth in Earnings Per Share. The EPS has been growing by 8.13% on average per year.
Looking at the last year, PEP shows a decrease in Revenue. The Revenue has decreased by -0.33% in the last year.
PEP shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 6.46% yearly.
EPS 1Y (TTM)-0.63%
EPS 3Y9.3%
EPS 5Y8.13%
EPS Q2Q%-7.02%
Revenue 1Y (TTM)-0.33%
Revenue growth 3Y4.94%
Revenue growth 5Y6.46%
Sales Q2Q%1%
3.2 Future
Based on estimates for the next years, PEP will show a small growth in Earnings Per Share. The EPS will grow by 3.34% on average per year.
Based on estimates for the next years, PEP will show a small growth in Revenue. The Revenue will grow by 3.19% on average per year.
EPS Next Y-0.7%
EPS Next 2Y2.43%
EPS Next 3Y3.58%
EPS Next 5Y3.34%
Revenue Next Year1.05%
Revenue Next 2Y2.12%
Revenue Next 3Y2.53%
Revenue Next 5Y3.19%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 18.24 indicates a rather expensive valuation of PEP.
Compared to the rest of the industry, the Price/Earnings ratio of PEP indicates a somewhat cheap valuation: PEP is cheaper than 65.63% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of PEP to the average of the S&P500 Index (27.30), we can say PEP is valued slightly cheaper.
A Price/Forward Earnings ratio of 16.76 indicates a correct valuation of PEP.
PEP's Price/Forward Earnings is on the same level as the industry average.
When comparing the Price/Forward Earnings ratio of PEP to the average of the S&P500 Index (22.73), we can say PEP is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.24 | ||
| Fwd PE | 16.76 |
4.2 Price Multiples
PEP's Enterprise Value to EBITDA ratio is in line with the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of PEP is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 27.82 | ||
| EV/EBITDA | 13.09 |
4.3 Compensation for Growth
PEP has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.24
EPS Next 2Y2.43%
EPS Next 3Y3.58%
5. Dividend
5.1 Amount
PEP has a Yearly Dividend Yield of 3.95%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.83, PEP pays a better dividend. On top of this PEP pays more dividend than 93.75% of the companies listed in the same industry.
PEP's Dividend Yield is rather good when compared to the S&P500 average which is at 2.41.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.95% |
5.2 History
The dividend of PEP is nicely growing with an annual growth rate of 6.80%!
PEP has been paying a dividend for at least 10 years, so it has 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 98.89% of its income as dividend. This is not a sustainable payout ratio.
PEP's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP98.89%
EPS Next 2Y2.43%
EPS Next 3Y3.58%
143.53
-0.7 (-0.49%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryBeverages
Earnings (Last)
Earnings (Next)
Inst Owners78.76%
Inst Owner Change0.54%
Ins Owners0.17%
Ins Owner Change0.06%
Market Cap196.50B
Analysts67.86
Price Target158.64 (10.53%)
Short Float %1.64%
Short Ratio2.33
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.95% |
Yearly Dividend5.27
Dividend Growth(5Y)6.8%
DP98.89%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.01%
Min EPS beat(2)-1.39%
Max EPS beat(2)3.41%
EPS beat(4)1
Avg EPS beat(4)0.46%
Min EPS beat(4)-1.39%
Max EPS beat(4)3.41%
EPS beat(8)5
Avg EPS beat(8)2.18%
EPS beat(12)9
Avg EPS beat(12)2.98%
EPS beat(16)12
Avg EPS beat(16)2.97%
Revenue beat(2)1
Avg Revenue beat(2)0.42%
Min Revenue beat(2)-0.16%
Max Revenue beat(2)1%
Revenue beat(4)1
Avg Revenue beat(4)-0.83%
Min Revenue beat(4)-2.81%
Max Revenue beat(4)1%
Revenue beat(8)1
Avg Revenue beat(8)-1.03%
Revenue beat(12)5
Avg Revenue beat(12)0.31%
Revenue beat(16)9
Avg Revenue beat(16)0.99%
PT rev (1m)0.83%
PT rev (3m)4.44%
EPS NQ rev (1m)-0.06%
EPS NQ rev (3m)-4.17%
EPS NY rev (1m)1.75%
EPS NY rev (3m)1.58%
Revenue NQ rev (1m)-0.09%
Revenue NQ rev (3m)1.79%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)1.32%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.24 | ||
| Fwd PE | 16.76 | ||
| P/S | 2.14 | ||
| P/FCF | 27.82 | ||
| P/OCF | 16.12 | ||
| P/B | 10.67 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.09 |
EPS(TTM)7.87
EY5.48%
EPS(NY)8.56
Fwd EY5.97%
FCF(TTM)5.16
FCFY3.59%
OCF(TTM)8.9
OCFY6.2%
SpS67.01
BVpS13.45
TBVpS-11.73
PEG (NY)N/A
PEG (5Y)2.24
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.17% | ||
| ROE | 40.99% | ||
| ROCE | 20.8% | ||
| ROIC | 16.72% | ||
| ROICexc | 18.91% | ||
| ROICexgc | 43.5% | ||
| OM | 15.63% | ||
| PM (TTM) | 8.23% | ||
| GM | 54.92% | ||
| FCFM | 7.7% |
ROA(3y)9.44%
ROA(5y)8.85%
ROE(3y)51.36%
ROE(5y)50.9%
ROIC(3y)15.79%
ROIC(5y)14.66%
ROICexc(3y)17.92%
ROICexc(5y)16.59%
ROICexgc(3y)38.78%
ROICexgc(5y)38.65%
ROCE(3y)20.23%
ROCE(5y)18.63%
ROICexcg growth 3Y1.22%
ROICexcg growth 5Y-0.39%
ROICexc growth 3Y8.31%
ROICexc growth 5Y3.24%
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%
F-Score5
Asset Turnover0.87
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.14 | ||
| Debt/FCF | 7.27 | ||
| Debt/EBITDA | 2.15 | ||
| Cap/Depr | 129.26% | ||
| Cap/Sales | 5.58% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 66.58% | ||
| Profit Quality | 93.56% | ||
| Current Ratio | 0.78 | ||
| Quick Ratio | 0.6 | ||
| Altman-Z | 3.53 |
F-Score5
WACC7.63%
ROIC/WACC2.19
Cap/Depr(3y)151.67%
Cap/Depr(5y)153.05%
Cap/Sales(3y)5.95%
Cap/Sales(5y)5.94%
Profit Quality(3y)75.09%
Profit Quality(5y)81.31%
High Growth Momentum
Growth
EPS 1Y (TTM)-0.63%
EPS 3Y9.3%
EPS 5Y8.13%
EPS Q2Q%-7.02%
EPS Next Y-0.7%
EPS Next 2Y2.43%
EPS Next 3Y3.58%
EPS Next 5Y3.34%
Revenue 1Y (TTM)-0.33%
Revenue growth 3Y4.94%
Revenue growth 5Y6.46%
Sales Q2Q%1%
Revenue Next Year1.05%
Revenue Next 2Y2.12%
Revenue Next 3Y2.53%
Revenue Next 5Y3.19%
EBIT growth 1Y0.64%
EBIT growth 3Y8.98%
EBIT growth 5Y6.67%
EBIT Next Year22.12%
EBIT Next 3Y10.64%
EBIT Next 5Y7.49%
FCF growth 1Y23.32%
FCF growth 3Y0.94%
FCF growth 5Y5.82%
OCF growth 1Y11.32%
OCF growth 3Y2.49%
OCF growth 5Y5.33%