PEPSICO INC (PEP) Stock Fundamental Analysis
USA - NASDAQ:PEP - US7134481081 - Common Stock
147.55 USD
+1.39 (+0.95%)
146.2 USD
-1.35 (-0.91%)
PEP gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 33 industry peers in the Beverages industry. PEP has an excellent profitability rating, but there are concerns on its financial health. PEP is valued expensive and it does not seem to be growing.
1. Profitability
1.1 Basic Checks
PEP had positive earnings in the past year.
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
The Return On Assets of PEP (6.78%) is better than 66.67% of its industry peers.
PEP has a better Return On Equity (37.26%) than 96.97% of its industry peers.
PEP's Return On Invested Capital of 15.32% is amongst the best of the industry. PEP outperforms 84.85% of its industry peers.
The Average Return On Invested Capital over the past 3 years for PEP is significantly above the industry average of 10.75%.
| 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
Looking at the Profit Margin, with a value of 7.82%, PEP is in line with its industry, outperforming 54.55% 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 15.49%, PEP is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
In the last couple of years the Operating Margin of PEP has remained more or less at the same level.
Looking at the Gross Margin, with a value of 54.50%, PEP is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
PEP's Gross Margin has been stable in the last couple of years.
| 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
PEP has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, PEP has about the same amount of shares outstanding.
The number of shares outstanding for PEP has been reduced compared to 5 years ago.
PEP has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 3.60 indicates that PEP is not in any danger for bankruptcy at the moment.
PEP's Altman-Z score of 3.60 is fine compared to the rest of the industry. PEP outperforms 66.67% of its industry peers.
The Debt to FCF ratio of PEP is 7.49, which is on the high side as it means it would take PEP, 7.49 years of fcf income to pay off all of its debts.
PEP has a Debt to FCF ratio of 7.49. This is comparable to the rest of the industry: PEP outperforms 54.55% of its industry peers.
PEP has a Debt/Equity ratio of 2.28. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 2.28, PEP is doing worse than 90.91% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.28 | ||
| Debt/FCF | 7.49 | ||
| Altman-Z | 3.6 |
ROIC/WACC2
WACC7.67%
2.3 Liquidity
A Current Ratio of 0.91 indicates that PEP may have some problems paying its short term obligations.
PEP has a Current ratio of 0.91. This is in the lower half of the industry: PEP underperforms 78.79% of its industry peers.
A Quick Ratio of 0.72 indicates that PEP may have some problems paying its short term obligations.
The Quick ratio of PEP (0.72) is comparable to the rest of the 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%.
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.
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 3.34% yearly.
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 Y0.39%
EPS Next 2Y3.09%
EPS Next 3Y3.94%
EPS Next 5Y3.34%
Revenue Next Year1.49%
Revenue Next 2Y2.49%
Revenue Next 3Y2.7%
Revenue Next 5Y3.19%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
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 18.80 indicates a rather expensive valuation of PEP.
PEP's Price/Earnings ratio is in line with the industry average.
The average S&P500 Price/Earnings ratio is at 26.19. PEP is valued slightly cheaper when compared to this.
The Price/Forward Earnings ratio is 17.01, which indicates a rather expensive current valuation of PEP.
PEP's Price/Forward Earnings ratio is in line with the industry average.
The average S&P500 Price/Forward Earnings ratio is at 22.50. PEP is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.8 | ||
| Fwd PE | 17.01 |
4.2 Price Multiples
PEP's Enterprise Value to EBITDA is on the same level as the industry average.
The rest of the industry has a similar Price/Free Cash Flow ratio as PEP.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 29.72 | ||
| EV/EBITDA | 13.68 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates PEP does not grow enough to justify the current Price/Earnings ratio.
PEP has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)48.16
PEG (5Y)2.31
EPS Next 2Y3.09%
EPS Next 3Y3.94%
5. Dividend
5.1 Amount
PEP has a Yearly Dividend Yield of 3.76%.
Compared to an average industry Dividend Yield of 3.05, PEP pays a better dividend. On top of this PEP pays more dividend than 84.85% 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 2.33.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.76% |
5.2 History
On average, the dividend of PEP grows each year by 6.80%, which is quite nice.
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
104.55% of the earnings are spent on dividend by PEP. This is not a sustainable payout ratio.
PEP's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP104.55%
EPS Next 2Y3.09%
EPS Next 3Y3.94%
147.55
+1.39 (+0.95%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryBeverages
Earnings (Last)
Earnings (Next)
Inst Owners78.94%
Inst Owner Change-0.42%
Ins Owners0.17%
Ins Owner Change0.7%
Market Cap201.75B
Revenue(TTM)92.37B
Net Income(TTM)7.22B
Analysts67.86
Price Target158.25 (7.25%)
Short Float %1.23%
Short Ratio2.12
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.76% |
Yearly Dividend5.27
Dividend Growth(5Y)6.8%
DP104.55%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1.92%
Min EPS beat(2)0.43%
Max EPS beat(2)3.41%
EPS beat(4)2
Avg EPS beat(4)0.59%
Min EPS beat(4)-1.39%
Max EPS beat(4)3.41%
EPS beat(8)5
Avg EPS beat(8)1.81%
EPS beat(12)9
Avg EPS beat(12)2.53%
EPS beat(16)12
Avg EPS beat(16)2.86%
Revenue beat(2)1
Avg Revenue beat(2)0.23%
Min Revenue beat(2)-0.53%
Max Revenue beat(2)1%
Revenue beat(4)1
Avg Revenue beat(4)-0.26%
Min Revenue beat(4)-1.36%
Max Revenue beat(4)1%
Revenue beat(8)1
Avg Revenue beat(8)-1.01%
Revenue beat(12)4
Avg Revenue beat(12)-0.1%
Revenue beat(16)8
Avg Revenue beat(16)0.76%
PT rev (1m)-0.24%
PT rev (3m)5.12%
EPS NQ rev (1m)2.56%
EPS NQ rev (3m)2.78%
EPS NY rev (1m)1.02%
EPS NY rev (3m)2.87%
Revenue NQ rev (1m)1.2%
Revenue NQ rev (3m)1.28%
Revenue NY rev (1m)0.43%
Revenue NY rev (3m)1.62%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.8 | ||
| Fwd PE | 17.01 | ||
| P/S | 2.18 | ||
| P/FCF | 29.72 | ||
| P/OCF | 17.16 | ||
| P/B | 10.41 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.68 |
EPS(TTM)7.85
EY5.32%
EPS(NY)8.67
Fwd EY5.88%
FCF(TTM)4.96
FCFY3.36%
OCF(TTM)8.6
OCFY5.83%
SpS67.55
BVpS14.18
TBVpS-10.46
PEG (NY)48.16
PEG (5Y)2.31
Graham Number50.04
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.78% | ||
| ROE | 37.26% | ||
| ROCE | 19.06% | ||
| ROIC | 15.32% | ||
| ROICexc | 17.32% | ||
| ROICexgc | 35.16% | ||
| OM | 15.49% | ||
| PM (TTM) | 7.82% | ||
| GM | 54.5% | ||
| FCFM | 7.35% |
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%
ROICexgc growth 3Y1.22%
ROICexgc 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 | 2.28 | ||
| Debt/FCF | 7.49 | ||
| Debt/EBITDA | 2.5 | ||
| Cap/Depr | 147.96% | ||
| Cap/Sales | 5.38% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 66.56% | ||
| Profit Quality | 93.98% | ||
| Current Ratio | 0.91 | ||
| Quick Ratio | 0.72 | ||
| Altman-Z | 3.6 |
F-Score5
WACC7.67%
ROIC/WACC2
Cap/Depr(3y)181.31%
Cap/Depr(5y)176.2%
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)-1.63%
EPS 3Y9.3%
EPS 5Y8.13%
EPS Q2Q%-0.87%
EPS Next Y0.39%
EPS Next 2Y3.09%
EPS Next 3Y3.94%
EPS Next 5Y3.34%
Revenue 1Y (TTM)0.49%
Revenue growth 3Y4.94%
Revenue growth 5Y6.46%
Sales Q2Q%2.65%
Revenue Next Year1.49%
Revenue Next 2Y2.49%
Revenue Next 3Y2.7%
Revenue Next 5Y3.19%
EBIT growth 1Y-0.41%
EBIT growth 3Y8.98%
EBIT growth 5Y6.67%
EBIT Next Year22.12%
EBIT Next 3Y10.68%
EBIT Next 5Y7.49%
FCF growth 1Y-2.29%
FCF growth 3Y0.94%
FCF growth 5Y5.82%
OCF growth 1Y-3.13%
OCF growth 3Y2.49%
OCF growth 5Y5.33%
PEPSICO INC / PEP FAQ
Can you provide the ChartMill fundamental rating for PEPSICO INC?
ChartMill assigns a fundamental rating of 4 / 10 to PEP.
What is the valuation status for PEP stock?
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 is the valuation of PEPSICO INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for PEPSICO INC (PEP) is 18.8 and the Price/Book (PB) ratio is 10.41.
Can you provide the dividend sustainability for PEP stock?
The dividend rating of PEPSICO INC (PEP) is 6 / 10 and the dividend payout ratio is 104.55%.