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PEP

PepsiCo NasdaqGS:PEP Stock Report

Last Price

US$175.04

Market Cap

US$241.5b

7D

-0.5%

1Y

12.9%

Updated

11 Aug, 2022

Data

Company Financials +
PEP fundamental analysis
Snowflake Score
Valuation5/6
Future Growth2/6
Past Performance5/6
Financial Health3/6
Dividends4/6

PEP Stock Overview

PepsiCo, Inc. manufactures, markets, distributes, and sells various beverages and convenient foods worldwide.

PepsiCo, Inc. Competitors

Price History & Performance

Summary of all time highs, changes and price drops for PepsiCo
Historical stock prices
Current Share PriceUS$175.04
52 Week HighUS$177.69
52 Week LowUS$149.48
Beta0.56
1 Month Change3.27%
3 Month Change0.76%
1 Year Change12.88%
3 Year Change33.91%
5 Year Change47.85%
Change since IPO1,534.62%

Recent News & Updates

Jul 28

Is PepsiCo Stock A Buy After Earnings? Dividend King Yields 2.7%

PepsiCo has delivered consistent financial results and consistent shareholder returns for decades. The company has increased its dividend for 50 consecutive years. Its consistency, and perhaps more importantly, the perception of consistency, has helped the stock avoid the intense volatility seen in the tech sectors. I am skeptical of the share repurchase program considering the rich valuation of the stock. I discuss whether the stock is a buy, sell, or hold at current prices considering the current market environment. PepsiCo (PEP) is one of those stocks where investors have grown accustomed to its predictability. The company's impressive lineup of household brands lends itself to consistent pricing power and margin expansion. While the company is not growing nearly as fast as hyper-growth tech stocks, its consistency, and perhaps more importantly the perception of consistency, has helped the stock avoid the intense volatility seen in the tech sectors. The stock is yielding 2.7%, placing it at the low end of the past decade. The stock may only be suitable for those fearful of further market weakness and even then, the rich valuation might not offer guaranteed protection. Pepsi Stock Price PEP is not a sexy stock, but its returns are looking impressive especially to tech investors. Data by YCharts With the stock trading at around $170 per share, the stock is near all-time highs - seemingly oblivious to the turmoil occurring in the tech sectors. What Were Pepsi's Expected Earnings? When PEP reported earnings on July 12th, the company was expected to show minimal revenue growth and stagnating earnings. Did PepsiCo Beat Earnings? Its actual results were more upbeat, with a sizable revenue beat. Seeking Alpha PEP Stock Key Metrics In the quarter, PEP saw revenue grow 5.2%. GAAP earnings per share declined by 39% while "core" earnings per share grew by 10%. 2022 Q2 Press Release What drove the discrepancy? We can see below that the company's European business has seen a sizable hit in operating profits whereas the PepsiCo Beverages North America business has seen an outsized gain in operating profits. 2022 Q2 Press Release Yet both of those are excluded from core EPS. PEP had recorded a non-cash gain on its Juice transaction as well as non-cash impairment charges due to the Russia-Ukraine conflict. 2022 Q2 Press Release After adjusting for those two non-cash line items, core EPS grew by a more predictable 10%. PEP ended the quarter with $5.4 billion of cash versus $39 billion in debt. What To Expect After Earnings PEP has guided for full-year organic revenue to increase by 10% (prior guidance was 8%) and for its core constant currency earnings per share to increase by 8%. That latter metric may have one too many adjustments - without adjusting for constant currency, core EPS is expected to grow 6% to $6.63. The company expects to return $7.7 billion to shareholders through $6.2 billion of dividends and $1.5 billion of share repurchases. Is PEP A Good Investment Long Term? Over the decades, PEP has built an iconic lineup of household brands. Consumer Analyst Group of New York Conference The company has been able to deliver consistent organic revenue growth which has led to even faster earnings growth. Consumer Analyst Group of New York Conference PEP has grown its dividend for 50 consecutive years, making the company a "Dividend King." Consumer Analyst Group of New York Conference I do question the company's decision to invest so much on share repurchases. The stock has historically traded at rich multiples and there has not been sizable growth over the past decade. Data by YCharts While PEP certainly has the free cash flow available for share repurchases, investors should instead consider that the company is not willing or simply does not have the ability to reinvest those cash flows at higher rates of return. Over the long term, PEP aims to grow revenues by up to 6% annually which should lead to high single digit growth in EPS. Combined with the 2.7% dividend yield, that might lead to something close to double-digit annual returns. Such an outlook is not hard to believe considering it can be achieved through a mix of volume and pricing growth.

Shareholder Returns

PEPUS BeverageUS Market
7D-0.5%-0.8%1.3%
1Y12.9%10.0%-11.7%

Return vs Industry: PEP exceeded the US Beverage industry which returned 10.3% over the past year.

Return vs Market: PEP exceeded the US Market which returned -11.6% over the past year.

Price Volatility

Is PEP's price volatile compared to industry and market?
PEP volatility
PEP Average Weekly Movement3.0%
Beverage Industry Average Movement7.2%
Market Average Movement7.8%
10% most volatile stocks in US Market16.9%
10% least volatile stocks in US Market3.2%

Stable Share Price: PEP is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: PEP's weekly volatility (3%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
1898309,000Ramon Laguartahttps://www.pepsico.com

PepsiCo, Inc. manufactures, markets, distributes, and sells various beverages and convenient foods worldwide. The company operates through seven segments: Frito-Lay North America; Quaker Foods North America; PepsiCo Beverages North America; Latin America; Europe; Africa, Middle East and South Asia; and Asia Pacific, Australia and New Zealand and China Region. It provides dips, cheese-flavored snacks, and spreads, as well as corn, potato, and tortilla chips; cereals, rice, pasta, mixes and syrups, granola bars, grits, oatmeal, rice cakes, simply granola, and side dishes; beverage concentrates, fountain syrups, and finished goods; ready-to-drink tea, coffee, and juices; dairy products; and sparkling water makers and related products.

PepsiCo, Inc. Fundamentals Summary

How do PepsiCo's earnings and revenue compare to its market cap?
PEP fundamental statistics
Market CapUS$241.54b
Earnings (TTM)US$9.24b
Revenue (TTM)US$81.86b

26.2x

P/E Ratio

3.0x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
PEP income statement (TTM)
RevenueUS$81.86b
Cost of RevenueUS$38.20b
Gross ProfitUS$43.66b
Other ExpensesUS$34.43b
EarningsUS$9.24b

Last Reported Earnings

Jun 11, 2022

Next Earnings Date

n/a

Earnings per share (EPS)6.69
Gross Margin53.33%
Net Profit Margin11.28%
Debt/Equity Ratio210.3%

How did PEP perform over the long term?

See historical performance and comparison

Dividends

2.6%

Current Dividend Yield

66%

Payout Ratio

Does PEP pay a reliable dividends?

See PEP dividend history and benchmarks
When do you need to buy PEP by to receive an upcoming dividend?
PepsiCo dividend dates
Ex Dividend DateSep 01 2022
Dividend Pay DateSep 30 2022
Days until Ex dividend20 days
Days until Dividend pay date49 days

Does PEP pay a reliable dividends?

See PEP dividend history and benchmarks