PEP
PepsiCo · Consumer Staples · Soft Drinks & Non-alcoholic Beverages
$144.67
52w 133.73 – 171.48
20y monthly, adjusted
Mkt cap
$197.5B
P/E
23.8
P/FCF
25.5
FCF yield
3.9%
ROE
40.4%
Shldr yield
4.4%
div 3.9% + bb 0.5%
What today's price assumes
At $197.5B, the market is pricing in 11.0% annual free-cash-flow growth for the next decade (10% discount rate, 2.5% terminal growth). Over the last ten years, FCF actually grew -0.5% per year — the price asks for acceleration beyond the historical record.
Simple DCF per-share range: $62 · $62 · $77 (4% / base / optimistic growth). An estimate, not a target.
Historical multiple lens
At its own median P/OCF of 11.9× across 18 years, PEP would trade near $105/share (25th–75th percentile: $79–$140); it trades at 16.3× today.
Assumes the historical multiple regime persists — re-ratings can be permanent.
Growth record
Compound annual growth rates from as-filed 10-K data, split-adjusted
Rev 3y
+2.8%
Rev 5y
+5.9%
Rev 10y
+4.1%
EPS 5y
+3.2%
EPS 10y
+5.0%
FCF 5y
+3.8%
FCF 10y
−0.5%
Fundamentals
Fiscal 2007–2025, from SEC filings
Revenue
Net income
Free cash flow
Diluted shares (lower is better)
Margins
Capital returned (dividends + buybacks)
Cash vs long-term debt
Quarterly
Discrete quarters from 10-Q filings; Q4 derived as fiscal year minus Q1–Q3. OCF is unwound from the year-to-date figures 10-Qs report. Compare to the same quarter a year ago — most businesses are seasonal.
Revenue by quarter
Net income by quarter
| Quarter | Revenue | YoY | Net income | YoY | EPS | OCF |
|---|---|---|---|---|---|---|
| Q2'26 | $24.2B | +6.4% | $3.0B | +136.0% | 2.18 | — |
| Q1'26 | $19.4B | +8.5% | $2.3B | +26.9% | 1.70 | $41.0M |
| Q4'25 * | $29.3B | +5.6% | $2.5B | +66.8% | 1.85 | — |
| Q3'25 | $23.9B | +2.7% | $2.6B | −11.2% | 1.90 | — |
| Q2'25 | $22.7B | +1.0% | $1.3B | −59.0% | 0.92 | — |
| Q1'25 | $17.9B | −1.8% | $1.8B | −10.2% | 1.33 | −$973.0M |
| Q4'24 * | $27.8B | −0.2% | $1.5B | +17.0% | 1.11 | — |
| Q3'24 | $23.3B | −0.6% | $2.9B | −5.2% | 2.13 | — |
| Q2'24 | $22.5B | +0.8% | $3.1B | +12.2% | 2.23 | — |
| Q1'24 | $18.3B | +2.3% | $2.0B | +5.7% | 1.48 | −$1.0B |
| Q4'23 * | $27.9B | −0.5% | $1.3B | +151.4% | 0.93 | — |
| Q3'23 | $23.5B | +6.7% | $3.1B | +14.4% | 2.24 | — |
| Q2'23 | $22.3B | +10.4% | $2.7B | +92.3% | 1.99 | — |
Track record
Compound annual growth by period. For debt and share count, negative is the good direction.
| Series | 3y | 5y | 10y | 15y |
|---|---|---|---|---|
| Revenue | +2.8% | +5.9% | +4.1% | +3.3% |
| Operating cash flow | +3.8% | +2.6% | +1.1% | +2.4% |
| Free cash flow | +11.0% | +3.8% | −0.5% | +2.6% |
| EPS (diluted) | −2.2% | +3.2% | +5.0% | +2.9% |
| Equity | +6.0% | +8.7% | +5.4% | −0.3% |
| LT debt | +5.9% | +0.9% | +3.8% | +5.1% |
| Diluted shares | −0.3% | −0.3% | −0.8% | −1.1% |
| Stock price | −3.6% | +1.6% | +6.2% | +8.7% |
$100, 3 years ago
$90vs $176 in SPY
-3.6% vs 20.7%/yr
$100, 5 years ago
$108vs $181 in SPY
1.6% vs 12.6%/yr
$100, 10 years ago
$183vs $412 in SPY
6.2% vs 15.2%/yr
$100, 15 years ago
$350vs $813 in SPY
8.7% vs 15.0%/yr
The $1 test — market value created per $1 of earnings retained (Buffett's hurdle: at least $1)
Last 5 years
$4.76
$47.1B created / $9.9B retained
Last 10 years
$4.24
$99.9B created / $23.6B retained
Quality & capital discipline
Cash-based returns and how management deploys capital
Cash ROIC
19.3%
OCF ÷ (equity + debt)
OCF / EV yield
5.3%
MC vs 10× OCF
1.62
≤1 = priced under 10× OCF
Debt / FCF
5.5y
SBC / FCF
3.8%
Owner earnings
$7.4B
OCF − capex − SBC
OE yield
3.8%
Share count 5y
−0.9%
per year; negative = buybacks
Capital intensity
31.8%
net PP&E ÷ revenue
Sales efficiency
$0.36
new PP&E per $1 new revenue, 5y
Growth engine (5y): reinvested 13.1% of operating cash flow at an incremental return of 18.6% — an organically fundable growth rate of about 2.4% per year (growth ≈ reinvestment rate × incremental ROIC).
Checklist
19 of 27 checks pass · 70%. Checks with structurally missing inputs are excluded.
Growth & Consistency
4/7
- pass
Revenue growth
5.9% · 5y CAGR ≥ 5%
- fail
EPS growth
3.2% · 5y CAGR ≥ 5%
- fail
FCF growth
3.8% · 5y CAGR ≥ 5%
- pass
Revenue rises consistently
9 of 9 · up in ≥ 7 of last 10 years
- pass
FCF consistently positive
10 of 10 · positive in ≥ 8 of last 10 years
- pass
Profitable every year
10 of 10 · net income > 0 in ≥ 8 of last 10
- fail
Cash flow keeps up with sales
2.6% vs 5.9% · OCF CAGR ≥ 0.9× revenue CAGR
Profitability
7/7
- pass
Net margin
8.8% · ≥ 8%
- pass
Operating margin
12.2% · ≥ 10%
- pass
Gross margin stable or rising
54.1% vs 53.0% · no drop > 2 pts over 3y
- pass
Return on equity
40.4% · ≥ 12%
- pass
Cash ROIC
19.3% · ≥ 12%
- pass
FCF margin
8.2% · ≥ 5%
- pass
Earnings back their cash
OCF $12.1B vs NI $8.2B · OCF ≥ net income (latest FY)
Balance Sheet
2/5
- fail
Debt payable from cash flow
5.5y · LT debt ≤ 3× FCF
- fail
Cash cushion
22% · cash ≥ 50% of LT debt
- fail
Leverage
2.07 · LT debt ≤ 1.5× equity
- pass
Equity positive and compounding
$20.4B · equity > 0 and grew over ~5y
- pass
Interest burden
10% · interest ≤ 15% of operating income
Capital Allocation
3/4
- pass
Share count flat or shrinking
-0.9% · ≤ +0.5%/yr over ~5y
- pass
Stock comp restrained
4% · SBC ≤ 15% of FCF
- fail
Distributions funded by FCF
113% · dividends + buybacks ≤ 100% of FCF
- pass
Repurchases are a habit
10 of 10 · buybacks in ≥ 5 of last 10 years
Valuation Discipline
3/4
- pass
FCF yield
3.9% · ≥ 3%
- pass
Earnings multiple
23.8 · P/E ≤ 25
- fail
Price asks less than history delivered
11.0% vs -0.5% · implied FCF growth ≤ historical FCF CAGR
- pass
Shareholder yield
4.4% · dividends + buybacks ≥ 2% of market cap
Red flags
Mechanical checks — a flag is a question to investigate, not a verdict
Heavy debt load
Long-term debt exceeds 5 years of free cash flow.
Distributions exceed FCF
Dividends plus buybacks exceeded free cash flow in the latest fiscal year.
Financial data
As filed in 10-Ks; per-share figures split-adjusted. $ in millions.
| FY | Revenue | Gross profit | Op income | Net income | EPS | OCF | CapEx | FCF | Dividends | Buybacks | SBC | Cash | LT debt | Equity | Shares |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2025 | 93,925 | 50,859 | 11,498 | 8,240 | 6.00 | 12,087 | 4,415 | 7,672 | 7,638 | 1,000 | 288 | 9,159 | 42,321 | 20,406 | 1,373 |
| 2024 | 91,854 | 50,110 | 12,887 | 9,578 | 6.95 | 12,507 | 5,318 | 7,189 | 7,229 | 1,000 | 362 | 8,505 | 37,224 | 18,041 | 1,378 |
| 2023 | 91,471 | 49,590 | 11,986 | 9,074 | 6.56 | 13,442 | 5,518 | 7,924 | 6,682 | 1,000 | 380 | 9,711 | 37,595 | 18,503 | 1,383 |
| 2022 | 86,392 | 45,816 | 11,512 | 8,910 | 6.42 | 10,811 | 5,207 | 5,604 | 6,172 | 1,500 | 343 | 4,954 | 35,657 | 17,149 | 1,387 |
| 2021 | 79,474 | 42,399 | 11,162 | 7,618 | 5.49 | 11,616 | 4,625 | 6,991 | 5,815 | 106 | 301 | 5,596 | 36,026 | 16,043 | 1,389 |
| 2020 | 70,372 | 38,575 | 10,080 | 7,120 | 5.12 | 10,613 | 4,240 | 6,373 | 5,509 | 2,000 | 264 | 8,185 | 40,370 | 13,454 | 1,392 |
| 2019 | 67,161 | 37,029 | 10,291 | 7,314 | 5.20 | 9,649 | 4,232 | 5,417 | 5,304 | 3,000 | 237 | 5,509 | 29,148 | 14,786 | 1,407 |
| 2018 | 64,661 | 35,280 | 10,110 | 12,515 | 8.78 | 9,415 | 3,282 | 6,133 | 4,930 | 2,000 | 256 | 8,721 | 28,295 | 14,518 | 1,425 |
| 2017 | 63,525 | 34,729 | 10,276 | 4,857 | 3.38 | 10,030 | 2,969 | 7,061 | 4,472 | 2,000 | 292 | 10,610 | 33,796 | 11,045 | 1,438 |
| 2016 | 62,799 | 34,577 | 9,804 | 6,329 | 4.36 | 10,663 | 3,040 | 7,623 | 4,227 | 3,000 | 284 | 9,158 | 30,053 | 11,246 | 1,452 |
| 2015 | 63,056 | 34,325 | 8,353 | 5,452 | 3.67 | 10,864 | 2,758 | 8,106 | 4,040 | 5,000 | 295 | 9,096 | 29,213 | 12,068 | 1,485 |
| 2014 | 66,683 | 35,445 | 9,581 | 6,513 | 4.27 | 10,506 | 2,859 | 7,647 | 3,730 | 5,012 | 297 | 6,134 | 23,821 | 17,578 | 1,527 |
| 2013 | 66,415 | 35,172 | 9,705 | 6,740 | 4.32 | 9,688 | 2,795 | 6,893 | 3,434 | 3,001 | 303 | 9,375 | 24,333 | 24,409 | 1,560 |
| 2012 | 65,492 | 34,201 | 9,112 | 6,178 | 3.92 | 8,479 | 2,714 | 5,765 | 3,305 | 3,219 | 278 | 6,297 | 23,544 | 22,417 | 1,575 |
| 2011 | 66,504 | — | 9,633 | 6,443 | 4.03 | 8,944 | 3,339 | 5,605 | 3,157 | 2,489 | 326 | 4,067 | 20,568 | 20,704 | 1,597 |
| 2010 | 57,838 | — | 8,332 | 6,320 | 3.91 | 8,448 | 3,253 | 5,195 | 2,978 | 4,978 | 299 | 5,943 | 19,999 | 21,273 | 1,614 |
| 2009 | 43,232 | — | 8,044 | 5,946 | 3.77 | 6,796 | 2,128 | 4,668 | 2,732 | 0 | 227 | 3,943 | 7,400 | 16,908 | 1,577 |
| 2008 | 43,251 | — | 6,959 | 5,142 | 3.21 | 6,999 | 2,446 | 4,553 | 2,541 | 4,720 | 238 | 2,064 | 7,858 | 12,203 | 1,602 |
| 2007 | 39,474 | — | 7,182 | 5,658 | 3.41 | 6,934 | 2,430 | 4,504 | 2,204 | 4,300 | 260 | 910 | — | 17,296 | — |
Some concepts are structurally absent for certain industries (banks report no gross profit or capex). Missing ≠ zero.