Valuation Overview

Growth Story

Over the next few years, revenue is expected to grow by 4.10%, lower than industry average of 7.28%.

Growth Trajectory

Profitability

In the growth phase company makes 13.70% profit on every dollar of sales, lower than industry average of 17.27%.

Profitability Trajectory

Risk Profile

Investors expect at least 7.45% return to justify the risk of holding stock.

Risk vs Return

Required Return (Cost of Capital) (%)
Return on Invested Capital (%)

Financial Health Overview

Enterprise Value
148.19B USD
Equity Value
104.65B USD
FCF Yield
55.05%
Average ROIC
16.92%
Cost of Capital
7.95%
P/E Ratio
19.69x
Financial MetricMost Recent 12 months (USD)Previous Year (USD)
Revenues91.75B USD91.85B USD
Operating Income or EBIT12.28B USD12.90B USD
Interest Expense1.01B USD919M USD
Book Value Of Equity18.42B USD18.04B USD
Book Value Of Debt51.38B USD44.95B USD
Cash and Marketable Securities7.97B USD9.27B USD
Number of Shares Outstanding1.37B--
Minority interests130M USD0 USD
Current Stock Price143.16 USD--
Effective Tax Rate19.00%--
Marginal Tax Rate25.00%--

Performance vs Industry

Revenue Growth
-7.40%
-0.12%Company
vs
7.28%Industry
Below Industry
Operating Margin
-3.89%
13.38%Company
vs
17.27%Industry
Below Industry
PepsiCo, Inc. faces challenges in both growth and profitability compared to industry peers, which may indicate competitive pressures or operational inefficiencies.

Terminal Value Analysis

Growth Rate
4.59%
Cost of Capital
8.83%
Return on Capital
8.83%
Reinvestment Rate
52.09%
Terminal value represents 54% of total enterprise value, based on 4.59% perpetual growth and 8.83% discount rate.

Equity Value Breakdown

ComponentValueType
Present Value (Terminal Value) 79.91B USD Add
Present Value (Cash Flow Over Next 10 Years) 68.27B USD Add
Value of Operating Assets 148.19B USD Sub-total
Debt 51.38B USD Subtract
Minority Interests 130.00M USD Subtract
Cash 7.97B USD Add
Value of Equity 104.65B USD Sub-total
Number of Shares 1.37B shares Divisor
Estimated Value per Share (Fair Value) 76.43 USD Total
Current Market Price 143.16 USD Reference

Financial Projections

Total FCF Present Value
68.27B USD
Avg Revenue Growth
3.84%
Avg Operating Margin
13.77%
Avg ROIC
16.92%
Year 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 Terminal Year
REVENUE
Revenue94.64B USD98.52B USD102.56B USD106.76B USD111.14B USD115.80B USD120.78B USD126.09B USD131.77B USD137.83B USD144.17B USD
Growth Rate 3.16% 4.09% 4.09% 4.09% 4.09% 4.19% 4.29% 4.39% 4.49% 4.59% 4.59%
PROFITABILITY
Operating Income12.67B USD13.39B USD14.05B USD14.73B USD15.45B USD16.10B USD16.80B USD17.54B USD18.32B USD19.17B USD20.05B USD
Operating Margin 13.38% 13.59% 13.70% 13.80% 13.90% 13.90% 13.90% 13.90% 13.90% 13.90% 13.90%
EBIT (1-tax)10.26B USD10.85B USD11.38B USD11.93B USD12.52B USD12.85B USD13.20B USD13.57B USD13.96B USD14.37B USD15.04B USD
CASH FLOW
Reinvestment1.33B USD1.39B USD1.45B USD1.50B USD1.60B USD2.97B USD3.17B USD3.38B USD3.62B USD3.78B USD7.83B USD
Free Cash Flow8.92B USD9.45B USD9.93B USD10.42B USD10.91B USD9.88B USD10.03B USD10.18B USD10.34B USD10.59B USD7.20B USD
Terminal Value--------------------170.33B USD
Present Value8.30B USD8.19B USD8.00B USD7.82B USD7.61B USD6.40B USD6.02B USD5.64B USD5.28B USD4.96B USD—
EFFICIENCY
ROIC 16.60% 17.17% 17.63% 18.08% 18.54% 18.59% 18.31% 18.03% 17.75% 17.47% 8.83%
Cost of Capital 7.44% 7.44% 7.44% 7.44% 7.44% 7.72% 8.00% 8.27% 8.55% 8.83% 8.83%
Sales/Capital 2.89x 2.89x 2.89x 2.89x 2.89x 1.67x 1.67x 1.67x 1.67x 1.67x —

Profitability & Efficiency

Operating Margin (%)
ROIC (%)

Value Creation Analysis

ROIC (%)
Cost of Capital (%)

Operational Cash Flow Analysis

Free Cash Flow ($B)
Reinvestment ($B)