PepsiCo (PEP)
Market Price (3/21/2026): $151.11 | Market Cap: $206.4 BilSector: Consumer Staples | Industry: Soft Drinks & Non-alcoholic Beverages
PepsiCo (PEP)
Market Price (3/21/2026): $151.11Market Cap: $206.4 BilSector: Consumer StaplesIndustry: Soft Drinks & Non-alcoholic Beverages
Investment Highlights Why It Matters Detailed financial logic regarding cash flow yields vs trend-riding momentum.
| Attractive yieldTotal YieldTotal Yield = Earnings Yield + Dividend Yield, Earnings Yield = Net Income / Market Cap Dividend Yield = Total Dividends / Market Cap is 7.7%, Dividend Yield is 3.7%, ERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is 3.6% | Weak multi-year price returns2Y Excs Rtn is -29%, 3Y Excs Rtn is -73% | Key risksPEP key risks include [1] shifting consumer preferences away from its core snack and soft drink products and [2] increasing regulatory scrutiny targeting its packaging waste and ingredients. |
| Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 13%, CFO LTM is 12 Bil, FCF LTM is 7.7 Bil | ||
| Low stock price volatilityVol 12M is 22% | ||
| Megatrend and thematic driversMegatrends include E-commerce & Digital Retail, Health & Wellness Trends, Vegan & Alternative Foods, and Circular Economy & Recycling. Show more. |
| Attractive yieldTotal YieldTotal Yield = Earnings Yield + Dividend Yield, Earnings Yield = Net Income / Market Cap Dividend Yield = Total Dividends / Market Cap is 7.7%, Dividend Yield is 3.7%, ERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is 3.6% |
| Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 13%, CFO LTM is 12 Bil, FCF LTM is 7.7 Bil |
| Low stock price volatilityVol 12M is 22% |
| Megatrend and thematic driversMegatrends include E-commerce & Digital Retail, Health & Wellness Trends, Vegan & Alternative Foods, and Circular Economy & Recycling. Show more. |
| Weak multi-year price returns2Y Excs Rtn is -29%, 3Y Excs Rtn is -73% |
| Key risksPEP key risks include [1] shifting consumer preferences away from its core snack and soft drink products and [2] increasing regulatory scrutiny targeting its packaging waste and ingredients. |
Qualitative Assessment
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1. Strong Fourth Quarter 2025 Earnings Beat and Optimistic Fiscal 2026 Guidance.
PepsiCo reported robust financial results for the fourth quarter of 2025 on February 3, 2026, exceeding market expectations. The company posted an earnings per share (EPS) of $2.26, a modest beat of 0.89% against the consensus estimate of $2.24. Net revenue increased 5.6% year-over-year to $29.3 billion, surpassing the $24.01 billion consensus by 22.20%. Furthermore, core EPS rose 11% on a constant currency basis. The company also affirmed a positive fiscal 2026 financial outlook, anticipating organic revenue growth between 2% and 4% and core constant currency EPS growth between 4% and 6%. This strong performance and clear forward guidance instilled investor confidence.
2. Enhanced Shareholder Returns Through Increased Dividends and a New Share Repurchase Program.
PepsiCo demonstrated a commitment to returning value to shareholders by announcing a 4% increase in its annualized dividend per share, set to commence with the June 2026 payment. This marks the 54th consecutive year of dividend increases for the company. Concurrently, PepsiCo authorized a new share repurchase program of up to $10 billion in common stock, with an expiration date of February 28, 2030. For fiscal 2026, the company expects total cash returns to shareholders to be approximately $8.9 billion, including $7.9 billion in dividends and $1.0 billion in share repurchases. These actions signal financial stability and a positive outlook on future cash generation.
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Stock Movement Drivers
Fundamental Drivers
The 2.8% change in PEP stock from 11/30/2025 to 3/20/2026 was primarily driven by a 12.2% change in the company's Net Income Margin (%).| (LTM values as of) | 11302025 | 3202026 | Change |
|---|---|---|---|
| Stock Price ($) | 146.00 | 150.04 | 2.8% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 92,366 | 93,925 | 1.7% |
| Net Income Margin (%) | 7.8% | 8.8% | 12.2% |
| P/E Multiple | 27.7 | 24.9 | -10.1% |
| Shares Outstanding (Mil) | 1,369 | 1,366 | 0.2% |
| Cumulative Contribution | 2.8% |
Market Drivers
11/30/2025 to 3/20/2026| Return | Correlation | |
|---|---|---|
| PEP | 2.8% | |
| Market (SPY) | -4.8% | -1.8% |
| Sector (XLP) | 2.4% | 71.3% |
Fundamental Drivers
The 3.8% change in PEP stock from 8/31/2025 to 3/20/2026 was primarily driven by a 6.6% change in the company's Net Income Margin (%).| (LTM values as of) | 8312025 | 3202026 | Change |
|---|---|---|---|
| Stock Price ($) | 144.49 | 150.04 | 3.8% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 91,748 | 93,925 | 2.4% |
| Net Income Margin (%) | 8.2% | 8.8% | 6.6% |
| P/E Multiple | 26.2 | 24.9 | -5.2% |
| Shares Outstanding (Mil) | 1,371 | 1,366 | 0.4% |
| Cumulative Contribution | 3.8% |
Market Drivers
8/31/2025 to 3/20/2026| Return | Correlation | |
|---|---|---|
| PEP | 3.8% | |
| Market (SPY) | 1.1% | -14.4% |
| Sector (XLP) | 1.3% | 65.1% |
Fundamental Drivers
The 2.6% change in PEP stock from 2/28/2025 to 3/20/2026 was primarily driven by a 18.9% change in the company's P/E Multiple.| (LTM values as of) | 2282025 | 3202026 | Change |
|---|---|---|---|
| Stock Price ($) | 146.27 | 150.04 | 2.6% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 91,854 | 93,925 | 2.3% |
| Net Income Margin (%) | 10.4% | 8.8% | -15.9% |
| P/E Multiple | 20.9 | 24.9 | 18.9% |
| Shares Outstanding (Mil) | 1,370 | 1,366 | 0.3% |
| Cumulative Contribution | 2.6% |
Market Drivers
2/28/2025 to 3/20/2026| Return | Correlation | |
|---|---|---|
| PEP | 2.6% | |
| Market (SPY) | 10.4% | 14.0% |
| Sector (XLP) | -0.3% | 69.0% |
Fundamental Drivers
The -3.7% change in PEP stock from 2/28/2023 to 3/20/2026 was primarily driven by a -14.9% change in the company's Net Income Margin (%).| (LTM values as of) | 2282023 | 3202026 | Change |
|---|---|---|---|
| Stock Price ($) | 155.78 | 150.04 | -3.7% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 86,392 | 93,925 | 8.7% |
| Net Income Margin (%) | 10.3% | 8.8% | -14.9% |
| P/E Multiple | 24.0 | 24.9 | 3.5% |
| Shares Outstanding (Mil) | 1,374 | 1,366 | 0.6% |
| Cumulative Contribution | -3.7% |
Market Drivers
2/28/2023 to 3/20/2026| Return | Correlation | |
|---|---|---|
| PEP | -3.7% | |
| Market (SPY) | 70.3% | 12.6% |
| Sector (XLP) | 21.4% | 70.7% |
Price Returns Compared
| 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | Total [1] | |
|---|---|---|---|---|---|---|---|
| Returns | |||||||
| PEP Return | 21% | 7% | -3% | -8% | -2% | 7% | 21% |
| Peers Return | 13% | 9% | -1% | -3% | 4% | -2% | 22% |
| S&P 500 Return | 27% | -19% | 24% | 23% | 16% | -3% | 76% |
Monthly Win Rates [3] | |||||||
| PEP Win Rate | 58% | 50% | 58% | 33% | 50% | 67% | |
| Peers Win Rate | 52% | 50% | 48% | 52% | 53% | 53% | |
| S&P 500 Win Rate | 75% | 42% | 67% | 75% | 67% | 33% | |
Max Drawdowns [4] | |||||||
| PEP Max Drawdown | -13% | -11% | -11% | -8% | -15% | -5% | |
| Peers Max Drawdown | -9% | -12% | -15% | -11% | -13% | -7% | |
| S&P 500 Max Drawdown | -1% | -25% | -1% | -2% | -15% | -3% | |
[1] Cumulative total returns since the beginning of 2021
[2] Peers: KO, MDLZ, KDP, GIS, MNST. See PEP Returns vs. Peers.
[3] Win Rate = % of calendar months in which monthly returns were positive
[4] Max drawdown represents maximum peak-to-trough decline within a year
[5] 2026 data is for the year up to 3/20/2026 (YTD)
How Low Can It Go
| Event | PEP | S&P 500 |
|---|---|---|
| 2022 Inflation Shock | ||
| % Loss | -19.4% | -25.4% |
| % Gain to Breakeven | 24.1% | 34.1% |
| Time to Breakeven | Not Fully Recovered days | 464 days |
| 2020 Covid Pandemic | ||
| % Loss | -29.3% | -33.9% |
| % Gain to Breakeven | 41.4% | 51.3% |
| Time to Breakeven | 284 days | 148 days |
| 2018 Correction | ||
| % Loss | -21.0% | -19.8% |
| % Gain to Breakeven | 26.6% | 24.7% |
| Time to Breakeven | 205 days | 120 days |
| 2008 Global Financial Crisis | ||
| % Loss | -42.4% | -56.8% |
| % Gain to Breakeven | 73.7% | 131.3% |
| Time to Breakeven | 1,485 days | 1,480 days |
Compare to KO, MDLZ, KDP, GIS, MNST
In The Past
PepsiCo's stock fell -19.4% during the 2022 Inflation Shock from a high on 5/12/2023. A -19.4% loss requires a 24.1% gain to breakeven.
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About PepsiCo (PEP)
AI Analysis | Feedback
Here are 1-2 brief analogies for PepsiCo:
- A global food and beverage giant similar to Nestlé.
- Imagine Coca-Cola for beverages combined with a leading snack company like Mondelez International.
AI Analysis | Feedback
- Snack Foods: PepsiCo offers a wide range of savory snack foods, including chips, dips, spreads, and cheese-flavored snacks.
- Grain-Based & Packaged Foods: The company produces various grain-based foods such as cereals, oatmeal, granola bars, and side dishes.
- Carbonated Soft Drinks: PepsiCo manufactures and distributes popular carbonated soft drinks, including concentrates, fountain syrups, and finished beverages.
- Non-Carbonated Beverages: The company provides a diverse portfolio of non-carbonated drinks, such as ready-to-drink teas, coffees, and juices.
- Dairy Products: PepsiCo produces and sells various dairy products to consumers globally.
- Sparkling Water Makers: PepsiCo markets sparkling water makers and associated consumables, primarily through its SodaStream brand.
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Major Customers of PepsiCo (PEP)
PepsiCo primarily sells its products to other businesses, including wholesale and other distributors, foodservice customers, and various retail channels. Its major customers are therefore large retail corporations and wholesale operators that then sell to individual consumers or smaller businesses. Some of these major customer companies include:
- Walmart Inc. (WMT)
- The Kroger Co. (KR)
- Target Corporation (TGT)
- Costco Wholesale Corporation (COST)
- Amazon.com, Inc. (AMZN)
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Ramon Laguarta Chairman and Chief Executive Officer
Ramon Laguarta joined PepsiCo in 1996 and has held various leadership roles across global markets, including CEO of PepsiCo's European and Sub-Saharan African division. He played a key role in the acquisition of Russian dairy and juice company Wimm-Bill-Dann in 2010. Laguarta began his professional career at Chupa Chups, a Spanish candy company.
Steve Schmitt Executive Vice President and Chief Financial Officer
Steve Schmitt was appointed Executive Vice President and Chief Financial Officer of PepsiCo, effective November 10, 2025. He joins PepsiCo from Walmart, where he served as EVP and CFO for Walmart U.S., overseeing financial operations for its multi-billion-dollar omni-channel business. Schmitt also held CFO roles across Walmart U.S. Omni-Channel, Walmart U.S. eCommerce, and Sam's Club. His career includes leadership positions at Yum! Brands and over a decade at UPS.
Steven Williams Executive Vice President & Vice Chairman, Global Chief Commercial Officer & Corporate Affairs
Steven Williams is the Executive Vice President & Vice Chairman, Global Chief Commercial Officer & Corporate Affairs. He previously served as CEO of PepsiCo North America.
Ram Krishnan Chief Executive Officer, PepsiCo North America
Ram Krishnan is set to become the CEO of PepsiCo North America, succeeding Steven Williams, effective December 28, 2025. He has a background in portfolio innovation and go-to-market transformation within PepsiCo's U.S. Beverages division.
Athina Kanioura Chief Executive Officer, Latin America Foods and Executive Vice President, Chief Strategy & Transformation Officer
Athina Kanioura serves as the CEO of Latin America Foods and is also the Executive Vice President, Chief Strategy & Transformation Officer at PepsiCo.
AI Analysis | Feedback
The key risks to PepsiCo's business include regulatory scrutiny and litigation, evolving consumer preferences and intense competition, and inflationary pressures and supply chain disruptions.
- Regulatory Scrutiny and Litigation: PepsiCo faces significant legal and regulatory risks, exemplified by a recent class-action lawsuit alleging price-fixing and previous investigations into discriminatory pricing by regulatory bodies. Non-compliance with various laws and regulations across its global operations, encompassing production, marketing, and environmental standards, could lead to substantial compliance costs, capital expenditures, and operational changes.
- Evolving Consumer Preferences and Intense Competition: The company operates in a highly competitive market where changing consumer tastes, particularly a shift towards healthier options and sustainable packaging, pose a continuous threat. This has contributed to market share erosion in some segments, such as losing the #2 U.S. soda spot, and has led to demands for strategic overhauls from activist investors. PepsiCo must continually innovate and adapt its product offerings to maintain relevance and defend its market position against both established rivals and emerging brands.
- Inflationary Pressures and Supply Chain Disruptions: PepsiCo's profitability is vulnerable to rising input costs, including agricultural commodities, fuel, and packaging materials. These inflationary pressures, coupled with potential disruptions in its complex global supply chain, can lead to gross margin compression if the company is unable to effectively pass on increased costs to consumers through pricing adjustments. Evidence suggests challenges in maintaining pricing power in certain snack categories, contributing to declining sales and market share in those areas.
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The rapid emergence and growth of companies and platforms focused on personalized, fresh, and plant-based nutrition delivered through direct-to-consumer (DTC) and subscription models. These offerings directly compete with PepsiCo's core business of mass-produced packaged beverages and convenient foods by catering to evolving consumer preferences for health, customization, and alternative convenience, potentially disrupting traditional retail channels and consumption habits.AI Analysis | Feedback
PepsiCo's addressable markets for its main products and services are substantial across various global and regional segments:
- The global snack food market was estimated at approximately $719.18 billion in 2024 and is projected to reach $922.08 billion by 2030.
- In the U.S., the snack food market was valued at about $172.54 billion in 2024, with projections indicating it could exceed $193.51 billion by 2030.
- The North American snack food market was approximately $70.25 billion in 2025 and is forecast to reach $87.02 billion by 2031.
- The global non-alcoholic beverages market was estimated at $1.41 trillion in 2025 and is predicted to grow to about $2.85 trillion by 2035.
- The North American non-alcoholic beverage market was sized at $366.58 billion in 2024 and is anticipated to reach $609.41 billion by 2033.
- For the U.S. non-alcoholic beverages market, the size was $169.55 billion in 2024, with a projection to grow to $246.90 billion by 2032.
- The global carbonated soft drink market was valued at about $496.46 billion in 2024 and is expected to reach $771.3 billion by 2033.
- The U.S. soft drinks market (including carbonated soft drinks, bottled water, etc.) was $293.5 billion in 2024 and is expected to grow to $545.2 billion by 2032.
- The global breakfast cereals market was valued at $65.23 billion in 2024 and is expected to reach $104.07 billion by 2032.
- North America's breakfast cereals market was valued at $17.40 billion in 2024.
- The U.S. breakfast cereal market is projected to reach an estimated value of $20.82 billion by 2032.
- The global savory snacks market was $285.85 billion in 2024 and is projected to reach $406.52 billion by 2032.
- The U.S. North America savory snacks market was valued at $37.59 billion in 2021 and is expected to reach $62.25 billion by 2030.
- The North America extruded snack food market was valued at $9.36 billion in 2024 and is estimated to reach $12.65 billion by 2033.
- The U.S. functional drinks market generated a revenue of $48.47 billion in 2024 and is expected to reach $77.97 billion by 2030.
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Here are the expected drivers of future revenue growth for PepsiCo (PEP) over the next 2-3 years:- International Market Expansion: PepsiCo expects continued strong growth from its international segments, particularly across Latin America, Europe, and the Asia-Pacific region. These markets are consistently highlighted as key growth engines, driven by broad-based demand for both snacks and beverages, and are seen as offsetting challenges in North America.
- Product Portfolio Innovation and Diversification: The company plans to accelerate organic revenue growth through evolving its product portfolio. This includes launching significant protein beverages, expanding its zero-sugar and "better-for-you" options, and deepening its presence in the energy drink category with brands like Rockstar and Celsius, as well as extending its Gatorade platform for sports hydration. Innovation also extends to flavor and format across its snack brands, including limited-time premium SKUs and portion-controlled packs.
- Strategic Pricing and Affordability Initiatives: PepsiCo anticipates driving revenue growth through its pricing power, which has historically helped offset volume fluctuations. The company also emphasizes a focus on affordability and innovation to support sales, especially in environments with cautious consumer spending.
- Productivity and Supply Chain Optimization: Significant productivity savings are expected through automation, digitalization, simplification initiatives, and the rationalization of warehouse infrastructure and manufacturing nodes. While primarily impacting margins, these efficiencies allow for reinvestment into growth initiatives, better service levels, and competitive pricing, indirectly supporting revenue expansion. PepsiCo aims for a record year of productivity savings in 2026.
- Expansion in Away-From-Home and E-commerce Channels: PepsiCo is strategically focusing on expanding its away-from-home business, which represents a higher-margin opportunity for both beverages and snacks. Additionally, the company is investing in digital activations and distribution to increase penetration in urban and rural e-commerce channels.
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Share Repurchases
- PepsiCo plans to return approximately $1.0 billion to shareholders through share repurchases in 2025.
- The company executed $1.0 billion in share repurchases in both 2024 and 2023.
- A new $10 billion share repurchase program was authorized on February 3, 2026, set to expire on February 28, 2030, which superseded a previous $10 billion program announced in February 2022.
Inbound Investments
- Activist investor Elliott Investment Management disclosed a substantial stake of approximately $4 billion in PepsiCo in September 2025.
Outbound Investments
- In March 2025, PepsiCo acquired Poppy, a prebiotic soda company, for $1.95 billion.
- The company invested $1.2 billion in October 2024 to acquire C8 Foods, known for its grain-free snacks.
- PepsiCo made a strategic investment of $550 million in Celsius, an energy drink company, in 2022.
Capital Expenditures
- Capital expenditures for fiscal year 2025 were -$4.42 billion, following $5.318 billion in 2024 and a peak of $5.518 billion in 2023.
- For 2026, capital spending is expected to be below 5% of net revenue.
- The primary focus of capital expenditures includes investments in capacity for faster-growing markets, cold-channel beverage execution, automation, and digital initiatives, alongside optimizing the North American supply chain and go-to-market systems.
Latest Trefis Analyses
| Title | Date | |
|---|---|---|
| DASHBOARDS | ||
| Better Value & Growth: KDP Tops PepsiCo Stock | 03/16/2026 | |
| PepsiCo vs Keurig Dr Pepper: Which Stock Could Rally? | 02/25/2026 | |
| Why COKE May Be Better Than PepsiCo Stock | 02/07/2026 | |
| PEP Stock Surges 15% In A 7-day Winning Spree On Earnings Beat And Buyback | 02/07/2026 | |
| Now Is Not The Time To Buy PepsiCo Stock | 01/31/2026 | |
| Ten-Year Tally: PepsiCo Stock Delivers $73 Bil Gain | 01/28/2026 | |
| PEP Stock Falls -5% With A 6-day Losing Spree On Technical Breakdown | 01/08/2026 | |
| PepsiCo Earnings Notes | 12/27/2025 | |
| 3 Reasons PepsiCo Stock Could Tumble | 12/24/2025 | |
| ARTICLES | ||
| Pay Less, Gain More: KDP Tops PepsiCo Stock | 03/16/2026 | |
| Stronger Bet Than PepsiCo Stock: KDP Delivers More | 03/05/2026 | |
| Can Keurig Dr Pepper Outrun PepsiCo in the Next Rally? | 02/24/2026 | |
| Why COKE Could Outperform PepsiCo Stock | 02/19/2026 | |
| COKE Looks Smarter Buy Than PepsiCo Stock | 02/18/2026 |
Trade Ideas
Select ideas related to PEP.
| Date | Ticker | Company | Category | Trade Strategy | 6M Fwd Rtn | 12M Fwd Rtn | 12M Max DD |
|---|---|---|---|---|---|---|---|
| 02272026 | BRBR | BellRing Brands | Dip Buy | DB | FCF Yield | Low D/EDip Buy with High Free Cash Flow YieldBuying dips for companies with significant free cash flow yield (FCF / Market Cap) and reasonable debt / market cap | 0.0% | 0.0% | 0.0% |
| 02132026 | STZ | Constellation Brands | Dip Buy | DB | FCFY OPMDip Buy with High FCF Yield and High MarginBuying dips for companies with high FCF yield and meaningfully high operating margin | 5.7% | 5.7% | 0.0% |
| 02132026 | KMB | Kimberly-Clark | Insider | Insider Buys | Low D/EStrong Insider BuyingCompanies with strong insider buying in the last 1 month, positive operating income and reasonable debt / market cap | 1.9% | 1.9% | -1.7% |
| 02062026 | AVO | Mission Produce | Insider | Insider Buys | Low D/EStrong Insider BuyingCompanies with strong insider buying in the last 1 month, positive operating income and reasonable debt / market cap | 1.1% | 1.1% | -2.7% |
| 01022026 | CALM | Cal-Maine Foods | Dip Buy | DB | FCFY OPMDip Buy with High FCF Yield and High MarginBuying dips for companies with high FCF yield and meaningfully high operating margin | 12.0% | 12.0% | -7.7% |
Research & Analysis
Invest in Strategies
Wealth Management
Peer Comparisons
| Peers to compare with: |
Financials
| Median | |
|---|---|
| Name | |
| Mkt Price | 64.95 |
| Mkt Cap | 72.2 |
| Rev LTM | 28,657 |
| Op Inc LTM | 3,636 |
| FCF LTM | 2,588 |
| FCF 3Y Avg | 2,877 |
| CFO LTM | 3,437 |
| CFO 3Y Avg | 3,859 |
Growth & Margins
| Median | |
|---|---|
| Name | |
| Rev Chg LTM | 4.0% |
| Rev Chg 3Y Avg | 4.7% |
| Rev Chg Q | 7.4% |
| QoQ Delta Rev Chg LTM | 2.0% |
| Op Mgn LTM | 18.8% |
| Op Mgn 3Y Avg | 19.4% |
| QoQ Delta Op Mgn LTM | 0.2% |
| CFO/Rev LTM | 12.7% |
| CFO/Rev 3Y Avg | 14.5% |
| FCF/Rev LTM | 9.2% |
| FCF/Rev 3Y Avg | 10.5% |
Valuation
| Median | |
|---|---|
| Name | |
| Mkt Cap | 72.2 |
| P/S | 2.2 |
| P/EBIT | 18.1 |
| P/E | 24.7 |
| P/CFO | 17.5 |
| Total Yield | 7.2% |
| Dividend Yield | 3.1% |
| FCF Yield 3Y Avg | 3.4% |
| D/E | 0.3 |
| Net D/E | 0.2 |
Returns
| Median | |
|---|---|
| Name | |
| 1M Rtn | -8.3% |
| 3M Rtn | -0.6% |
| 6M Rtn | 3.8% |
| 12M Rtn | -1.6% |
| 3Y Rtn | -8.5% |
| 1M Excs Rtn | -3.1% |
| 3M Excs Rtn | 3.2% |
| 6M Excs Rtn | 5.9% |
| 12M Excs Rtn | -16.7% |
| 3Y Excs Rtn | -74.3% |
Comparison Analyses
Segment Financials
Revenue by Segment| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| PepsiCo Beverages North America (PBNA) | 27,626 | 26,213 | 25,276 | 22,559 | 21,730 |
| Frito-Lay North America (FLNA) | 24,914 | 23,291 | 19,608 | 18,189 | 17,078 |
| Europe | 13,234 | 12,724 | 13,038 | 11,922 | 11,728 |
| Latin America (LatAm) | 11,654 | 9,779 | 8,108 | 6,942 | 7,573 |
| Africa, Middle East and South Asia (AMESA) | 6,139 | 6,438 | 6,078 | 4,573 | 3,651 |
| Asia Pacific, Australia and New Zealand and China region (APAC) | 4,803 | 4,787 | 4,615 | 3,445 | 2,919 |
| Quaker Foods North America (QFNA) | 3,101 | 3,160 | 2,751 | 2,742 | 2,482 |
| Corporate unallocated expenses | 0 | 0 | 0 | ||
| Total | 91,471 | 86,392 | 79,474 | 70,372 | 67,161 |
| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| Frito-Lay North America (FLNA) | 6,755 | 6,135 | 5,633 | 5,340 | 5,258 |
| PepsiCo Beverages North America (PBNA) | 2,584 | 5,426 | 2,442 | 1,937 | 2,179 |
| Latin America (LatAm) | 2,252 | 1,627 | 1,369 | 1,033 | 1,141 |
| Africa, Middle East and South Asia (AMESA) | 807 | 666 | 858 | 600 | 671 |
| Europe | 767 | -1,380 | 1,292 | 1,353 | 1,327 |
| Asia Pacific, Australia and New Zealand and China region (APAC) | 713 | 537 | 673 | 590 | 477 |
| Quaker Foods North America (QFNA) | 492 | 604 | 578 | 669 | 544 |
| Corporate unallocated expenses | -2,384 | -2,103 | -1,683 | -1,442 | -1,306 |
| Total | 11,986 | 11,512 | 11,162 | 10,080 | 10,291 |
Price Behavior
| Market Price | $150.04 | |
| Market Cap ($ Bil) | 205.0 | |
| First Trading Date | 06/01/1972 | |
| Distance from 52W High | -11.2% | |
| 50 Days | 200 Days | |
| DMA Price | $156.47 | $144.09 |
| DMA Trend | up | up |
| Distance from DMA | -4.1% | 4.1% |
| 3M | 1YR | |
| Volatility | 22.5% | 22.4% |
| Downside Capture | -46.16 | -1.23 |
| Upside Capture | -46.18 | 5.10 |
| Correlation (SPY) | -8.1% | 14.7% |
| 1M | 2M | 3M | 6M | 1Y | 3Y | |
|---|---|---|---|---|---|---|
| Beta | -0.26 | -0.36 | -0.36 | -0.45 | 0.15 | 0.15 |
| Up Beta | 1.70 | 0.79 | 0.93 | 0.61 | 0.33 | 0.33 |
| Down Beta | 0.34 | -0.07 | -0.23 | -0.39 | 0.10 | 0.07 |
| Up Capture | -10% | -10% | -27% | -35% | 5% | 2% |
| Bmk +ve Days | 9 | 20 | 31 | 70 | 142 | 431 |
| Stock +ve Days | 15 | 25 | 33 | 63 | 123 | 378 |
| Down Capture | -214% | -179% | -147% | -143% | -13% | 14% |
| Bmk -ve Days | 12 | 21 | 30 | 54 | 109 | 320 |
| Stock -ve Days | 6 | 16 | 28 | 61 | 127 | 373 |
[1] Upside and downside betas calculated using positive and negative benchmark daily returns respectively
Based On 1-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with PEP | |
|---|---|---|---|---|
| PEP | 5.4% | 22.4% | 0.16 | - |
| Sector ETF (XLP) | 3.9% | 14.1% | 0.04 | 67.9% |
| Equity (SPY) | 15.8% | 18.9% | 0.64 | 15.3% |
| Gold (GLD) | 48.2% | 27.0% | 1.45 | 3.4% |
| Commodities (DBC) | 17.8% | 17.4% | 0.83 | 0.1% |
| Real Estate (VNQ) | 1.0% | 16.4% | -0.11 | 39.5% |
| Bitcoin (BTCUSD) | -19.0% | 44.2% | -0.35 | 1.2% |
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Based On 5-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with PEP | |
|---|---|---|---|---|
| PEP | 5.7% | 18.1% | 0.20 | - |
| Sector ETF (XLP) | 6.7% | 13.2% | 0.30 | 76.2% |
| Equity (SPY) | 11.8% | 17.0% | 0.54 | 29.9% |
| Gold (GLD) | 20.7% | 17.5% | 0.97 | 5.2% |
| Commodities (DBC) | 10.9% | 19.0% | 0.46 | 1.2% |
| Real Estate (VNQ) | 2.8% | 18.8% | 0.06 | 40.6% |
| Bitcoin (BTCUSD) | 4.7% | 56.7% | 0.30 | 4.8% |
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Based On 10-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with PEP | |
|---|---|---|---|---|
| PEP | 7.2% | 19.5% | 0.31 | - |
| Sector ETF (XLP) | 7.2% | 14.7% | 0.36 | 82.4% |
| Equity (SPY) | 14.2% | 17.9% | 0.68 | 51.1% |
| Gold (GLD) | 13.3% | 15.7% | 0.70 | 7.9% |
| Commodities (DBC) | 8.3% | 17.6% | 0.39 | 11.3% |
| Real Estate (VNQ) | 5.0% | 20.7% | 0.21 | 55.0% |
| Bitcoin (BTCUSD) | 66.9% | 66.8% | 1.06 | 7.6% |
Smart multi-asset allocation framework can stack odds in your favor. Learn How
Returns Analyses
Earnings Returns History
Expand for More| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 2/3/2026 | 2.0% | 2.5% | -1.3% |
| 10/9/2025 | 3.7% | 5.5% | -1.2% |
| 7/17/2025 | -1.5% | -0.6% | 3.4% |
| 4/24/2025 | -1.4% | -1.3% | -4.4% |
| 2/4/2025 | 1.5% | 1.5% | 7.7% |
| 10/8/2024 | 1.2% | 3.2% | -3.4% |
| 7/11/2024 | 1.5% | 3.9% | 5.1% |
| 4/23/2024 | 3.6% | 2.7% | 6.3% |
| ... | |||
| SUMMARY STATS | |||
| # Positive | 18 | 14 | 11 |
| # Negative | 5 | 9 | 12 |
| Median Positive | 1.5% | 2.1% | 3.8% |
| Median Negative | -1.4% | -1.3% | -2.5% |
| Max Positive | 3.7% | 5.5% | 8.7% |
| Max Negative | -1.9% | -3.1% | -6.8% |
Insider Activity
Expand for More| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Gallagher, Marie T | SVP and Controller | Direct | Sell | 3062025 | 159.55 | 25,000 | 3,988,780 | 3,559,906 | Form |
| 2 | Williams, Steven C | CEO, North America | Direct | Sell | 3042025 | 150.89 | 17,978 | 2,712,733 | 18,446,372 | Form |
| 3 | Flavell, David | EVP, Gen Counsel & Corp Sec | Direct | Sell | 3042025 | 150.90 | 6,906 | 1,042,144 | 6,437,569 | Form |
| 4 | Laguarta, Ramon | Chairman and CEO | Direct | Sell | 3042025 | 154.90 | 50,000 | 7,744,890 | 72,679,597 | Form |
| 5 | Willemsen, Eugene | CEO, International Beverages | Non-U.S. Company | Sell | 3042025 | 154.33 | 10,000 | 1,543,308 | 2,390,121 | Form |
PEP Trade Sentinel
AVOID (Score 1-2)
CONVICTION RATIONALE
The probability-adjusted skew is below 1.0x, indicating an unfavorable risk/reward profile. The 'Anti-Alpha' of volume declines and potential margin erosion in the core Frito-Lay business carries a higher probability (60%) than the upside from cost savings. The stock is fairly valued for its current challenges, but there is no compelling, mispriced catalyst to justify taking on the risk of further volume deterioration.
STOCK ARCHETYPE
Mature Cash CowPepsiCo is a 'Mature Cash Cow' (Type B) due to its defensive consumer staples nature, iconic brand equity, massive distribution scale, and consistent capital returns. However, it is facing decelerating volume growth, forcing a focus on capital efficiency and pricing power, which are the core analytical focal points for this archetype.
INVESTMENT THESIS
The primary driver for PepsiCo's stock is a defensive margin expansion story. With top-line growth slowing due to volume pressures, the company's explicit goal to deliver a record year of productivity savings becomes the main lever for earnings growth. This involves significant SKU rationalization, plant closures, and manufacturing consolidation to offset inflationary pressures and fund innovation in higher-growth segments.
- Management has guided for a record year of productivity savings in 2026 to fund investments and accelerate growth.
- Strategic actions include reducing U.S. SKUs by nearly 20% in 1H 2026.
- The company is closing three plants and consolidating manufacturing lines to improve efficiency.
- Despite volatile revenue, the company has a history of consistently beating EPS estimates, indicating strong operational control.
PRIMARY RISK
The primary friction is the persistent decline in organic volumes in core North American markets, driven by consumer price sensitivity and a structural shift away from calorie-dense snacks. This has forced the company to pivot from price hikes to price cuts on key Frito-Lay brands, directly threatening the historically high margins of its most profitable division and risking a price war.
- Organic volume declined 2% in Q4 2025, with PepsiCo Beverages North America (PBNA) volume down 4%.
- The company has announced price reductions on major snack brands like Lay's, Doritos, and Cheetos to address affordability concerns.
- Private label dollar sales grew nearly 3x the rate of national brands in 2025, indicating intense price competition.
| KPI | Threshold | Rationale |
|---|---|---|
| Frito-Lay North America (FLNA) Organic Volume Growth | Stabilization (Flat YoY) | This is the most critical metric. A return to flat or positive volume would signal that the pricing strategy is working and would alleviate fears of margin collapse in the company's most profitable segment. |
| Organic Revenue Growth | > 3.0% | The company's guidance is for 2-4% growth. Beating the midpoint of this range would indicate that either volume is recovering faster than expected or international strength is successfully offsetting North American weakness. |
| Core Constant Currency EPS Growth | > 5.0% | Guidance is for 4-6% growth. Achieving the upper half of this range would validate the 'Alpha Driver' thesis that productivity savings are successfully translating into bottom-line growth despite top-line headwinds. |
Productivity Savings vs. Volume Collapse
BULL VIEW
Aggressive cost savings from plant closures and SKU reduction will protect and expand margins, allowing EPS to grow even with flat revenue.
CORE TENSION
Can cost cuts and productivity gains offset margin erosion from declining North American volumes and forced price reductions in the core Frito-Lay snacks division?
PREVAILING SENTIMENT
Q4 2025 organic volume declined 2%, forcing management to announce price reductions on Lay's, Doritos, and Cheetos to address affordability concerns and trade-down.
BEAR VIEW
Price cuts to combat private label will fail to recover volume, crushing Frito-Lay's high margins and triggering a negative EPS revision cycle.
| Timeline | Event & Metric To Watch |
|---|---|
Late April 2026 | Q1 2026 Earnings Report Watch: Frito-Lay North America (FLNA) Organic Volume Growth & Operating Margin % |
Ongoing (Next 6 Months) | GLP-1 Drug Coverage Announcements Watch: Announcements of expanded insurance coverage for GLP-1 drugs for weight loss, not just diabetes. |
With Q1 Earnings (Late April 2026) | Packaging Regulation Disclosures (10-Q) Watch: Disclosure of specific CapEx or SG&A costs related to reformulation of packaging to comply with EU/US PFAS bans. |
| Date | Event | Stock Impact |
|---|---|---|
8/13/2025 | New Partnership with Lavazza Details: Announced a strategic partnership to launch a new line of ready-to-drink iced coffee beverages in Europe, expanding its coffee portfolio. | Modest 1.69% gain $144.03 -> $146.47 |
9/8/2025 | Major Brand Relaunch Initiative Details: PepsiCo announced a major relaunch of its core Pepsi brand with new marketing and packaging, which was met with investor skepticism. | Fell notably by -3.2% $144.97 -> $140.33 |
10/9/2025 | Q3 2025 Earnings Release Details: The company reported earnings that exceeded expectations, driven by international strength, but North American beverage volumes declined by 3%. | Rose significantly by 4.23% $137.49 -> $143.30 |
11/11/2025 | Strategic Acquisition Announced Details: PepsiCo announced the acquisition of a prebiotic soda brand, Poppi, signaling a strategic push into the high-growth functional beverage category. | Modest 1.72% gain $141.23 -> $143.67 |
12/10/2025 | Investor Day Presentation Details: Management detailed its 2026 productivity program, highlighting plans for SKU rationalization and plant closures aimed at delivering record cost savings. | Rose significantly by 3.5% $144.64 -> $149.70 |
2/3/2026 | Q4 2025 Earnings & Guidance Update Details: PepsiCo beat analyst estimates, but reported a 2% organic volume decline and announced price cuts for 2026 to combat weakening consumer demand. | Rose significantly by 4.93% $155.20 -> $162.85 |
Position Sizing
1% - 3%
CONSERVATIVE
The prevailing BEARISH sentiment, driven by decelerating volumes and a contested moat, creates significant fundamental headwinds. This warrants a conservative position until visibility on volume recovery improves.
Diversification Alternatives
SMPL
SECTORDirectly benefits from the health & wellness trend (low-carb/sugar) that is a structural headwind for PepsiCo's core snack portfolio.
BRBR
SECTORPure-play on the high-growth protein shake/supplement market, capturing consumers actively moving away from PepsiCo's sugary beverage portfolio.
Trading at a Trailing P/E of ~28.2x and a Forward P/E of ~20.4x, PepsiCo is being valued as a stable consumer staples giant navigating a trade-off between pricing power and volume growth, particularly in its core North American snacks division.
Filter all news through the lens of the volume vs. price/margin trade-off, especially in the North American food business, and the resilience of international growth.
Sustained organic revenue growth in the 2-4% target range driven by a recovery in North American food volumes; international businesses maintaining mid-single-digit growth; successful launch and market share gains from new 'healthier' product innovations like Doritos Protein or Pepsi Prebiotic.
Continued volume declines in Frito-Lay North America despite price reductions; significant gross margin compression due to inability to pass on costs or from heavy promotional activity; loss of beverage market share to Coca-Cola or other emerging brands in key international markets.
Minor quarterly fluctuations in commodity costs; single-country regulatory headlines about sugar taxes (already a well-understood long-term headwind); typical seasonal marketing campaigns.
Repricing Catalyst
The primary catalyst is the successful execution of its affordability and innovation strategy in the PepsiCo Foods North America (PFNA) division. This involves targeted price cuts on key brands like Lay's and Doritos to recapture volume from value-sensitive consumers, combined with the launch of new products to improve market competitiveness. Success would demonstrate a recovery in volume growth without sacrificing the segment's margin structure, potentially leading to upward EPS revisions.
North American Convenient Foods (Frito-Lay & Quaker)
$31.4B TTM (34% of Total) · 54% MarginWhat It Is
Lay's Potato Chips, Doritos Tortilla Chips, Cheetos, Tostitos Tortilla Chips, Rold Gold Pretzels, Quaker Oats, Chewy Granola Bars.
Who Pays & How
Walmart is the largest customer, accounting for over 10% of total revenue. Retailers pay for these products due to high consumer demand and brand loyalty, which drives foot traffic. The direct-store-delivery (DSD) system ensures product freshness and high in-stock levels, creating a switching cost for retailers.
Competition
North American Beverages
$25.7B TTM (28% of Total) · 54% MarginWhat It Is
Pepsi, Diet Pepsi, Pepsi Zero Sugar, Mountain Dew, Gatorade, Tropicana juices, Aquafina water, Starbucks ready-to-drink coffee, Lipton ready-to-drink tea.
Who Pays & How
Retailers (e.g. Walmart, Target) and foodservice operators (e.g. Yum! Brands) pay for a diversified portfolio of high-demand beverage brands that cater to multiple consumption occasions, from carbonated soft drinks to sports hydration and juices.
Competition
International (All Segments)
$34.9B TTM (38% of Total) · 54% MarginWhat It Is
A mix of global brands (Pepsi, Lay's, Doritos, Gatorade) and local brands tailored to regional tastes (e.g., Sabritas in Mexico, Walkers in the UK).
Who Pays & How
A fragmented base of international retailers, distributors, and wholesalers pay for access to PepsiCo's globally recognized brands and localized products that are popular with consumers in their respective markets.
Competition
External Quote Links
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| FinViz |
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