NasdaqGS:PEP

Stock Analysis Report

Executive Summary

PepsiCo, Inc. operates as a food and beverage company worldwide.


Snowflake Analysis

Established dividend payer and fair value.


Similar Companies

Share Price & News

How has PepsiCo's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: PEP has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

10.2%

PEP

10.2%

US Beverage

5.3%

US Market


1 Year Return

3.1%

PEP

-4.2%

US Beverage

-10.7%

US Market

Return vs Industry: PEP exceeded the US Beverage industry which returned -3.5% over the past year.

Return vs Market: PEP exceeded the US Market which returned -10.4% over the past year.


Shareholder returns

PEPIndustryMarket
7 Day10.2%10.2%5.3%
30 Day-5.0%-12.1%-13.6%
90 Day-8.2%-15.5%-19.8%
1 Year6.0%3.1%-1.8%-4.2%-8.9%-10.7%
3 Year22.4%12.0%13.2%4.3%15.5%8.0%
5 Year51.1%30.4%31.0%14.7%35.2%20.4%

Price Volatility Vs. Market

How volatile is PepsiCo's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is PepsiCo undervalued compared to its fair value and its price relative to the market?

23.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: PEP ($125.48) is trading below our estimate of fair value ($163.81)

Significantly Below Fair Value: PEP is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: PEP is good value based on its PE Ratio (24x) compared to the Beverage industry average (27.8x).

PE vs Market: PEP is poor value based on its PE Ratio (24x) compared to the US market (13.1x).


Price to Earnings Growth Ratio

PEG Ratio: PEP is poor value based on its PEG Ratio (2.9x)


Price to Book Ratio

PB vs Industry: PEP is overvalued based on its PB Ratio (11.8x) compared to the US Beverage industry average (2.3x).


Next Steps

Future Growth

How is PepsiCo forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

8.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PEP's forecast earnings growth (8.2% per year) is above the savings rate (1.7%).

Earnings vs Market: PEP's earnings (8.2% per year) are forecast to grow slower than the US market (12.2% per year).

High Growth Earnings: PEP's earnings are forecast to grow, but not significantly.

Revenue vs Market: PEP's revenue (4% per year) is forecast to grow slower than the US market (7.2% per year).

High Growth Revenue: PEP's revenue (4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: PEP's Return on Equity is forecast to be very high in 3 years time (56.8%).


Next Steps

Past Performance

How has PepsiCo performed over the past 5 years?

14.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PEP has high quality earnings.

Growing Profit Margin: PEP's current net profit margins (10.9%) are lower than last year (19.2%).


Past Earnings Growth Analysis

Earnings Trend: PEP's earnings have grown by 14.1% per year over the past 5 years.

Accelerating Growth: PEP's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: PEP had negative earnings growth (-41.2%) over the past year, making it difficult to compare to the Beverage industry average (9.2%).


Return on Equity

High ROE: Whilst PEP's Return on Equity (49.46%) is outstanding, this metric is skewed due to their high level of debt.


Next Steps

Financial Health

How is PepsiCo's financial position?


Financial Position Analysis

Short Term Liabilities: PEP's short term assets ($17.6B) do not cover its short term liabilities ($20.5B).

Long Term Liabilities: PEP's short term assets ($17.6B) do not cover its long term liabilities ($43.2B).


Debt to Equity History and Analysis

Debt Level: PEP's debt to equity ratio (215.7%) is considered high.

Reducing Debt: PEP's debt to equity ratio has increased from 165.2% to 215.7% over the past 5 years.

Debt Coverage: PEP's debt is well covered by operating cash flow (30.1%).

Interest Coverage: PEP's interest payments on its debt are well covered by EBIT (11.5x coverage).


Balance Sheet

Inventory Level: PEP has a high level of physical assets or inventory.

Debt Coverage by Assets: PEP's debt is not covered by short term assets (assets are 0.6x debt).


Next Steps

Dividend

What is PepsiCo's current dividend yield, its reliability and sustainability?

3.04%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: PEP's dividend (3.04%) is higher than the bottom 25% of dividend payers in the US market (1.95%).

High Dividend: PEP's dividend (3.04%) is low compared to the top 25% of dividend payers in the US market (5.4%).


Stability and Growth of Payments

Stable Dividend: PEP's dividends per share have been stable in the past 10 years.

Growing Dividend: PEP's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (72.5%), PEP's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: PEP's dividends in 3 years are forecast to be covered by earnings (67% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.4yrs

Average management tenure


CEO

Ramon Laguarta (55yo)

1.42s

Tenure

US$16,870,817

Compensation

Mr. Ramon Luis Laguarta has been an Independent Director of Visa Inc. since November 20, 2019. Mr. Laguarta has been Chief Executive Officer and Director of PepsiCo, Inc. since October 3, 2018 and serves a ...


CEO Compensation Analysis

Compensation vs Market: Ramon's total compensation ($USD16.87M) is above average for companies of similar size in the US market ($USD11.74M).

Compensation vs Earnings: Ramon's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Ramon Laguarta
Chairman & CEO1.42yrsUS$16.87m0.0051% $9.0m
Hugh Johnston
Vice Chairman10yrsUS$11.29m0.0076% $13.2m
Ronald Adrianus Schellekens
Executive VP & Chief Human Resources Officer1.25yrsUS$4.18mno data
Kirk Tanner
Chief Executive Officer of North America Beverages1.17yrsUS$6.84m0.0031% $5.4m
Silviu Popovici
Chief Executive Officer of Europeno dataUS$6.13m0.0017% $2.9m
Grace Puma
Executive Vice President of Global Operations2.42yrsno datano data
Rene Lammers
Executive VP & Chief Science Officer1yrno datano data
Seth Cohen
Senior VP & Global Chief Information Officer0.25yrno datano data
David Yawman
Executive VP of Government Affairs2.42yrsno data0.0046% $8.1m
Jon Banner
Executive VP of Global Communications & President of PepsiCo Foundation5.83yrsno datano data

1.4yrs

Average Tenure

54yo

Average Age

Experienced Management: PEP's management team is not considered experienced ( 1.4 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Ramon Laguarta
Chairman & CEO1.42yrsUS$16.87m0.0051% $9.0m
Ian Cook
Presiding Independent Directorno dataUS$351.67k0.00026% $453.2k
William Johnson
Independent Director5yrsUS$301.67k0.00027% $470.7k
Robert Pohlad
Independent Director5yrsUS$301.67k0.082% $143.6m
Dina Dublon
Independent Director14.67yrsUS$341.67k0.00018% $313.8k
Daniel Vasella
Independent Director18yrsUS$359.66k0.0010% $1.8m
Alberto Weisser
Independent Director8.42yrsUS$341.67k0.000070% $122.0k
Richard Fisher
Independent Director5yrsUS$311.67k0.000070% $122.0k
Shona Brown
Independent Director11yrsUS$341.67k0.000070% $122.0k
David Page
Independent Director5.25yrsUS$311.67k0.000070% $122.0k

5.3yrs

Average Tenure

65yo

Average Age

Experienced Board: PEP's board of directors are considered experienced (5.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

PepsiCo, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: PepsiCo, Inc.
  • Ticker: PEP
  • Exchange: NasdaqGS
  • Founded: 1898
  • Industry: Soft Drinks
  • Sector: Food, Beverage & Tobacco
  • Market Cap: US$174.322b
  • Shares outstanding: 1.39b
  • Website: https://www.pepsico.com

Number of Employees


Location

  • PepsiCo, Inc.
  • 700 Anderson Hill Road
  • Purchase
  • New York
  • 10577
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
PEPNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDJan 1968
PEPSWX (SIX Swiss Exchange)YesCommon StockCHCHFJan 1968
PEP *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJan 1968
PEPDB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968
PEPXTRA (XETRA Trading Platform)YesCommon StockDEEURJan 1968
PEPSNSE (Santiago Stock Exchange)YesCommon StockCLUSDJan 1968
0QOSLSE (London Stock Exchange)YesCommon StockGBUSDJan 1968
PEPENXTBR (Euronext Brussels)YesCommon StockBEUSDJan 1968
PEPSWBAG (Wiener Boerse AG)YesCommon StockATEURJan 1968
PEPETLX (Eurotlx)YesCommon StockITEURJan 1968
PEPBASE (Buenos Aires Stock Exchange)CEDEAR EACH REP 1/2 ORD CP STK USD0.0166ARARSSep 2000
PEPB34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH REPR 1 CAP USD0.016666BRBRLAug 2012

Biography

PepsiCo, Inc. operates as a food and beverage company worldwide. The company operates through seven segments: FLNA, QFNA, PBNA, LatAm, Europe, AMESA, and APAC. It offers branded dips, cheese-flavored snacks, and tortillas, as well as corn, potato, and tortilla chips; cereals, rice, pasta, mixes and syrups, granola bars, grits, oat squares, oatmeal, rice cakes, simply granola, and side dishes; beverage concentrates, fountain syrups, and finished goods; ready-to-drink tea, coffee, and juices; and dairy products. The company provides its products primarily under the Cheetos, Doritos, Fritos, Lay’s, Ruffles, Tostitos, Aunt Jemima, Cap’n crunch, Life, Pasta Roni, Quaker Chewy, Quaker, Rice-A-Roni, Aquafina, Diet Mountain Dew, Diet Pepsi, Gatorade, Mountain Dew, Pepsi, Propel, Sierra Mist, Tropicana, Emperador, Marias Gamesa, Rosquinhas Mabel, Sabritas, Saladitas, 7UP, Gatorade, H2oh!, Manzanita Sol, Mirinda, Pepsi, Pepsi Black, San Carlos, Toddy, Agusha, Chudo, and Domik v Derevne brands. It serves wholesale and other distributors, foodservice customers, grocery stores, drug stores, convenience stores, discount/dollar stores, mass merchandisers, membership stores, hard discounters, e-commerce retailers and authorized independent bottlers, and others through a network of direct-store-delivery, customer warehouse, and distributor networks, as well as directly to consumers through e-commerce platforms and retailers. The company was founded in 1898 and is headquartered in Purchase, New York. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/31 01:30
End of Day Share Price2020/03/30 00:00
Earnings2019/12/28
Annual Earnings2019/12/28


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.