Business Description
PepsiCo, Inc. is a global enterprise that creates, promotes, and supplies a diverse array of drinks and easy-to-prepare food items across the globe. Its operations are structured into seven primary divisions: Frito-Lay North America, Quaker Foods North America, PepsiCo Beverages North America, Latin America, Europe, Africa/Middle East/South Asia, and the Asia Pacific, Australia, New Zealand, and China Region. The company's extensive product catalog encompasses popular snack foods like various dips, cheese snacks, spreads, and a range of chips (including corn, potato, and tortilla varieties). Its pantry staples feature cereals, rice, pasta, baking mixes, beverage syrups, granola bars, grits, oatmeal, rice cakes, and ready-made side dishes. In the beverage sector, PepsiCo offers concentrated syrups, fountain beverages, pre-packaged drinks, ready-to-consume teas, coffees, fruit juices, dairy-based items, and home carbonation systems with associated goods. PepsiCo reaches its broad clientele, which includes wholesale partners, food service providers, various retail outlets like supermarkets, pharmacies, convenience shops, discount stores, large-format retailers, membership-based stores, hard discount retailers, online merchants, and approved independent bottlers. This widespread distribution is achieved via direct store delivery, customer warehouse systems, and comprehensive distributor networks, along with direct sales to consumers through digital commerce channels and retail partners. Established in 1898, the corporation maintains its principal office in Purchase, New York.
Business History
Generated: Jun 27, 2026 3:15amPrice Overview
Last updated: Jun 27, 2026 3:13am (4h ago)Price History (1 Year)
Revenue & Net Income Trend
| Period | Revenue | Net Income | Net Margin | YoY/QoQ |
|---|
Key Metrics
EPS (Diluted): 6.03
Total Equity: $20.41B
Shares: 1,373,000,000
Total Debt: $49.18B
Cash: $9.16B
EBITDA: $15.54B
Total Debt: $49.18B
Cash: $9.16B
Revenue: $93.93B
Revenue: $93.93B
Revenue: $93.93B
Total Equity: $20.41B
Tax Rate: 19.0%
Equity: $20.41B
Total Debt: $49.18B
Cash: $9.16B
Current Liabilities: $32.76B
Long-Term Debt: $42.32B
Total Debt: $49.18B
Total Equity: $20.41B
Shares: 1,373,000,000
Shares: 1,373,000,000
CapEx: -$4.42B
Shares: 1,373,000,000
Stock Price: $139.52
Net Income: $8.24B
Industry Benchmarks
Advanced Analysis Forensic deep-dive · three lenses
PepsiCo shows the hallmarks of a high-quality mature compounder: revenue grew from 79.5B in 2021 to 93.9B in 2025 (about 4.3% CAGR), gross margin expanded modestly from 53.3% to 54.1%, and operating margin held steady at 14.4%. FCF averaged roughly 7B per year and was 7.67B in 2025, comfortably funding both the dividend and net buybacks (buyback/SBC ratio of 275%, with diluted share count actually shrinking slightly from 1.39B to 1.37B). Earnings quality is genuinely clean: OCF/NI of 1.4x, accruals at -3.5% of assets, Beneish M of -2.54, and Altman Z of 3.5 all corroborate that reported profits are real cash profits.
Verify before trusting this (5)
- Drivers of the 2025 net income decline (impairments, restructuring, Quaker recall, FX) versus underlying operating performance
- Organic volume vs price/mix in Frito-Lay North America and PBNA - are unit volumes actually declining?
- Debt maturity ladder and weighted average interest rate on the ~40B net debt to confirm refinancing risk is contained
- International segment growth and margin trajectory to assess durability beyond the mature US business
- Status of any GLP-1 related volume impact on snacks and beverages mentioned in recent disclosures
Three independent methods triangulate well below the tape: DCF $119.50, EPV floor $95.88, and anchored P/E $139.48 - composite $118.59, signal-adjusted $105.20. At $141.39 the stock trades ~19% above composite FV and ~34% above signal-adjusted FV. The anchored P/E is the only method that gets close, and it does so by importing the current premium multiple - i.e. it confirms the market pays up, not that the business deserves it. EPV at $95.88 says the steady-state cash earnings, capitalized soberly, are worth roughly two-thirds of today's price.
Verify before trusting this (4)
- 2025 EPS dip drivers - one-off FX/restructuring vs structural margin compression
- Organic volume trends in Frito-Lay North America (the cash engine)
- Pricing/elasticity commentary on next print - is pricing power still intact
- Capex and buyback cadence vs $40B net debt trajectory
PepsiCo sits in a quiet sentiment pocket. The macro tape is neutral with VIX at 18 and the S&P only modestly off highs, and PEP's 0.36 beta means even a risk-off shift would barely scratch it. The active narrative is a low-intensity, durable steady-compounder / bond-proxy story - exactly the kind of name that gets quietly bid as a safety hold when uncertainty rises, but does not catch any of the speculative tailwinds blowing through risk assets. There is no cult, no momentum chase, and no narrative break - just a slow defensive grind. News flow is mixed but skews mildly negative: BofA trimmed the Q2 outlook citing North American snack weakness, Bernstein initiated only at Market Perform, and headlines frame Coca-Cola as the cleaner beverage play. Offsetting that, the 54-year dividend-king framing and pre-earnings 'buy before July 9' pieces reinforce the defensive-income narrative. Analyst tone is a soft Hold with a $167 target well above spot and 5 upward revisions this month averaging $160 - a quiet positive divergence against the cautious headlines.
Verify before trusting this (4)
- July 9 Q2 print - any further snack-segment guide-down would crack the defensive premium
- Whether sell-side target revisions keep drifting up post-earnings or reverse
- Any rotation from defensives into cyclicals if VIX falls and tape turns risk-on - would pressure PEP relatively
- KO vs PEP relative performance as the 'cleaner staple' framing persists
Deep Analysis
Pre-flight intelligence scans the company first, then routes to the right analytical methods.
Income Statement (Annual)
Last updated: Jun 27, 2026 3:17am (4h ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $79.5B | $86.4B | $91.5B | $91.9B | $93.9B |
| Cost of Revenue | $37.1B | $40.6B | $41.9B | $41.7B | $43.1B |
| Gross Profit | $42.4B | $45.8B | $49.6B | $50.1B | $50.9B |
| Operating Expenses | $31.2B | $34.3B | $37.6B | $37.2B | $37.4B |
| Operating Income | $11.2B | $11.5B | $12.0B | $12.9B | $13.5B |
| Net Income | $7.6B | $8.9B | $9.1B | $9.6B | $8.2B |
| EBITDA | $14.9B | $14.9B | $15.8B | $16.7B | $15.5B |
| EPS | $5.51 | $6.46 | $6.59 | $6.98 | $6.03 |
| EPS (Diluted) | — | — | — | — | — |
Balance Sheet (Annual)
Last updated: Jun 27, 2026 3:13am (4h ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Cash & Equivalents | $5.6B | $5.0B | $9.7B | $8.5B | $9.2B |
| Total Current Assets | $21.8B | $21.5B | $27.0B | $25.8B | $27.9B |
| Total Assets | $92.4B | $92.2B | $100.5B | $99.5B | $107.4B |
| Current Liabilities | $26.2B | $26.8B | $31.6B | $31.5B | $32.8B |
| Long-Term Debt | $36.0B | $35.7B | $37.6B | $37.2B | $42.3B |
| Total Liabilities | $76.2B | $74.9B | $81.9B | $81.3B | $86.9B |
| Total Equity | $16.0B | $17.1B | $18.5B | $18.0B | $20.4B |
| Retained Earnings | $65.2B | $67.8B | $70.0B | $72.3B | $72.8B |
Cash Flow (Annual)
Last updated: Jun 24, 2026 3:03am (3d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Operating Cash Flow | $11.6B | $10.8B | $13.4B | $12.5B | $12.1B |
| Capital Expenditure | -$4.6B | -$5.2B | -$5.5B | -$5.3B | -$4.4B |
| Free Cash Flow | $7.0B | $5.6B | $7.9B | $7.2B | $7.7B |
| Acquisitions (net) | $108.0M | $2.6B | -$239.0M | -$90.0M | -$3.4B |
| Debt Repayment | — | — | — | — | — |
| Dividends Paid | — | — | — | — | — |
| Stock Buybacks | -$106.0M | -$1.5B | -$1.0B | -$1.0B | -$1.0B |
| Net Change in Cash | -$2.5B | -$607.0M | $4.7B | -$1.2B | $651.0M |
Analyst Estimates (Annual)
Last updated: Jun 27, 2026 3:13am (4h ago)| Metric | 2027 | 2028 | 2029 | 2030 |
|---|---|---|---|---|
| Revenue |
$102.2B $101.1B – $102.7B
|
$105.6B $105.5B – $105.7B
|
$107.9B $106.7B – $109.3B
|
$112.0B $110.8B – $113.5B
|
| EBITDA |
$18.0B $17.8B – $18.1B
|
$18.6B $18.6B – $18.6B
|
$19.0B $18.8B – $19.2B
|
$19.7B $19.5B – $20.0B
|
| Net Income |
$12.5B $12.3B – $12.6B
|
$12.2B $11.1B – $14.8B
|
$13.5B $13.3B – $13.8B
|
$14.3B $14.1B – $14.5B
|
| EPS | — | — | — | — |
Growth Trends (YoY %)
Last updated: Jun 27, 2026 3:17am (4h ago)| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue Growth | +8.7% | +5.9% | +0.4% | +2.3% |
| Gross Profit Growth | +8.1% | +8.2% | +1.0% | +1.5% |
| Operating Income Growth | +3.1% | +4.1% | +7.5% | +4.7% |
| Net Income Growth | +17.0% | +1.8% | +5.6% | -14.0% |
| EBITDA Growth | +0.2% | +5.6% | +5.9% | -6.8% |
Insider Trading (Recent)
Last updated: Jun 27, 2026 3:17am (4h ago)All SEC Form 4 codes
- P Purchase
- Open-market or private purchase of shares.
- S Sale
- Open-market or private sale of shares.
- A Award / grant
- Grant or award of securities (RSUs, options, etc.) under Rule 16b-3.
- D Return to issuer
- Securities disposed back to the company under Rule 16b-3.
- F In-kind (tax)
- Shares withheld or delivered to pay the option-exercise price or tax — not an open-market sale.
- I Discretionary
- Discretionary transaction under an employee plan — Rule 16b-3(f).
- M Option exercise
- Exercise or conversion of a derivative (option/RSU) into shares — exempt.
- C Conversion
- Conversion of a derivative security into the underlying shares.
- E Short expiration
- Expiration of a short derivative position.
- H Long expiration
- Expiration or cancellation of a long derivative position with value received.
- O OTM exercise
- Exercise of an out-of-the-money derivative.
- X ITM exercise
- Exercise of an in-the-money or at-the-money derivative.
- G Gift
- Bona fide gift of securities.
- L Small acquisition
- Small acquisition under Rule 16a-6.
- W Inheritance
- Acquisition or disposition by will or the laws of descent.
- Z Voting trust
- Deposit into or withdrawal from a voting trust.
- J Other
- Other acquisition or disposition (explained in a Form 4 footnote).
- K Equity swap
- Transaction in an equity swap or similar instrument.
- U Tender / buyout
- Disposition via tender of shares in a change-of-control transaction.
Compensation-plan codes (A, D, F, M) are routine and rarely directional. Open-market P (buy) and S (sale) carry the most signal.
| Date | Insider | Type | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-05-06 | Gibbs David W | A-Award | 534.33 | $0.00 | $0 |
| 2026-05-06 | Gibbs David W | A-Award | 1,000.00 | $0.00 | $0 |
| 2026-05-06 | Gibbs David W | 0.00 | $0.00 | $0 | |
| 2026-03-04 | Willemsen Eugene | S-Sale | 3,798.00 | $164.46 | $624,600 |
| 2026-03-04 | Willemsen Eugene | S-Sale | 2,702.00 | $164.44 | $444,323 |
| 2026-03-02 | POHLAD ROBERT C | J-Other | 900,000.00 | $0.00 | $0 |
| 2026-03-02 | POHLAD ROBERT C | A-Award | 199.90 | $138.96 | $27,778 |
| 2026-03-02 | POHLAD ROBERT C | J-Other | 900,000.00 | $0.00 | $0 |
| 2026-03-01 | Flavell David | A-Award | 25,831.00 | $0.00 | $0 |
| 2026-03-01 | Flavell David | D-Return | 783.00 | $0.00 | $0 |
| 2026-03-01 | Flavell David | F-InKind | 2,143.00 | $169.05 | $362,274 |
| 2026-03-01 | Flavell David | A-Award | 12,160.00 | $0.00 | $0 |
| 2026-03-01 | Laguarta Ramon | A-Award | 44,904.00 | $0.00 | $0 |
| 2026-03-01 | Laguarta Ramon | D-Return | 6,940.00 | $0.00 | $0 |
| 2026-03-01 | Laguarta Ramon | F-InKind | 24,940.00 | $169.05 | $4.2M |
| 2026-03-01 | Laguarta Ramon | A-Award | 67,356.00 | $0.00 | $0 |
| 2026-03-02 | Laguarta Ramon | S-Sale | 27,945.00 | $167.39 | $4.7M |
| 2026-03-01 | Popovici Silviu | A-Award | 26,883.00 | $0.00 | $0 |
| 2026-03-01 | Popovici Silviu | D-Return | 1,433.00 | $0.00 | $0 |
| 2026-03-01 | Popovici Silviu | F-InKind | 4,040.00 | $169.05 | $682,962 |
Dividend History (Last 20)
Last updated: Jun 21, 2026 7:03pm (5d ago)| Date | Dividend | Declaration | Record | Payment |
|---|---|---|---|---|
| 2026-06-05 | $1.48 | 2026-05-06 | 2026-06-05 | 2026-06-30 |
| 2026-03-06 | $1.42 | 2026-02-04 | 2026-03-06 | 2026-03-31 |
| 2025-12-05 | $1.42 | 2025-11-19 | 2025-12-05 | 2026-01-06 |
| 2025-09-05 | $1.42 | 2025-07-24 | 2025-09-05 | 2025-09-30 |
| 2025-06-06 | $1.42 | 2025-05-06 | 2025-06-06 | 2025-06-30 |
| 2025-03-07 | $1.36 | 2025-02-05 | 2025-03-07 | 2025-03-31 |
| 2024-12-06 | $1.36 | 2024-11-19 | 2024-12-06 | 2025-01-06 |
| 2024-09-06 | $1.36 | 2024-07-25 | 2024-09-06 | 2024-09-30 |
| 2024-06-07 | $1.36 | 2024-04-30 | 2024-06-07 | 2024-06-28 |
| 2024-02-29 | $1.27 | 2024-02-07 | 2024-03-01 | 2024-04-01 |
| 2023-11-30 | $1.27 | 2023-11-16 | 2023-12-01 | 2024-01-05 |
| 2023-08-31 | $1.27 | 2023-07-20 | 2023-09-01 | 2023-09-29 |
| 2023-06-01 | $1.27 | 2023-05-02 | 2023-06-02 | 2023-06-30 |
| 2023-03-02 | $1.15 | 2023-02-01 | 2023-03-03 | 2023-03-31 |
| 2022-12-01 | $1.15 | 2022-11-17 | 2022-12-02 | 2023-01-06 |
| 2022-09-01 | $1.15 | 2022-07-21 | 2022-09-02 | 2022-09-30 |
| 2022-06-02 | $1.15 | 2022-05-03 | 2022-06-03 | 2022-06-30 |
| 2022-03-03 | $1.08 | 2022-02-02 | 2022-03-04 | 2022-03-31 |
| 2021-12-02 | $1.08 | 2021-11-18 | 2021-12-03 | 2022-01-07 |
| 2021-09-02 | $1.08 | 2021-07-15 | 2021-09-03 | 2021-09-30 |
Narrative Economics
market-narrative step).
Delvantic AI Findings
Looking at the raw numbers first: PepsiCo's revenue grew from $79.5B (2021) to $93.9B (2025), a 4.3% CAGR — not the 1.3% the momentum module reports (which appears to be annualized over a different window or mis-computed). However, net income went from $7.62B (2021) to $8.24B (2025), and actually fell from $9.58B in 2024 to $8.24B in 2025 — a 14% earnings decline on 2.3% revenue growth. That's the real story: margin compression. Operating margin slipped from ~14% in 2021-2022 to 14.4% TTM but net margin collapsed to 8.77% from 11%+ historically. Gross margin held at 54%, so the squeeze is below the line — opex, interest, FX, or restructuring. The quarterly cadence confirms volatility: Q2'25 net margin of 5.6% and Q4'24 at 5.5% are alarming for a "stable staple."
The synthesis pegs fair value at $105-118 vs $139.52 — I think that's directionally right but the bear case is overstated. FCF of $7.67B on a $190.7B market cap is a 4.0% FCF yield; add the 3.89% dividend yield (which is roughly funded by FCF — payout is tight given dividends likely run ~$7B+) and you have a bond-proxy yielding ~4% with 2-4% nominal growth. That's a ~6-8% expected return — fine for a defensive sleeve, unexciting on risk-adjusted basis when 10Y Treasuries offer 4%+ risk-free. P/E of 22x on declining earnings is the actual problem; if 2026 EPS doesn't recover toward $8+ (vs ~$6 TTM run-rate implied by recent quarters), the multiple is unsupportable. Current ratio of 0.85 and the missing total debt figure (a real data gap — PEP carries ~$45B+ gross debt historically) means leverage isn't trivial, and the Market Forces module is right to flag this as a constraint on transformation capex.
Where I disagree with the prior models: the Market Forces "avoid" verdict is too aggressive for a Dividend Aristocrat with Frito-Lay's snack moat (a genuinely durable cash engine that GLP-1 narratives have overstated — snack volume data through 2025 shows resilience, not collapse). The Narrative module's "34% premium = pure story" framing ignores that mature staples have traded at 22-25x for a decade; the premium isn't new, it's the earnings denominator that shrank. The contrarian case here is actually mean-reversion bullish: if 2025's earnings drop reflects one-time Quaker recall costs, FX, and restructuring (which it largely does), normalized EPS is closer to $8.25-8.75, putting forward P/E at ~16-17x — cheap for PEP historically. The insider activity is genuinely neutral-to-slightly-negative (modest sales, routine awards, the 900K "J-Other" entries are likely trust/gift transfers, not signal), so no edge there.
My verdict: I dissent partially from the synthesis. $105 fair value is too punitive — it extrapolates trough margins. But $139.52 is also not a bargain; it requires believing in margin normalization the company hasn't yet demonstrated. Fair value sits in a $115-125 range, meaning the stock is ~10-15% overvalued, not 25%. The thesis is binary on whether 2026 shows margin recovery toward 11-12% net. The Q1'26 print showing 12% net margin on $19.4B is actually encouraging — that's a real data point the bearish synthesis underweights. I'd wait for confirmation in Q2/Q3'26 or a pullback to $120-125 before committing; the 3.9% dividend isn't enough to bridge the valuation gap alone, and there are better risk-adjusted defensives (KO at similar multiple has cleaner trajectory).
GPT Critique
PepsiCo's financials show a company with stable but uninspiring growth, where revenue increased from $79.5 billion in 2021 to $93.9 billion in 2025, reflecting a CAGR of about 4.3%. This contrasts with the reported 1.3% revenue CAGR, suggesting a miscalculation. However, net income actually decreased from $9.58 billion in 2024 to $8.24 billion in 2025, highlighting significant margin compression. This is evident in the net margin, which fell from over 11% to 8.77%, despite the operating margin slightly improving to 14.4% TTM. The margins tell a story of operational challenges perhaps due to increased operational expenses or adverse currency effects, given that gross margins remain stable at 54%.
I agree with Opus that PepsiCo is modestly overvalued at its current price of $139.52. The fair value range of $115-$125 proposed by Opus is reasonable, given the company's dividend yield of 3.89% and free cash flow yield of 4.0%, which together imply a bond-like return profile suited for defensive investors. This aligns with the notion of PepsiCo being treated as a bond-proxy, with its expected return not being overly compelling when compared to risk-free 10-year Treasuries yielding over 4%.
Where I diverge from Opus is on the assessment of future earnings potential. Opus suggests that the market might expect PepsiCo to recover its net margins to 11-12% and achieve EPS of $8+ in 2026. However, given the historical volatility in quarterly margins and the lack of concrete evidence of a turnaround in operational efficiency, I am more cautious about this optimism. The Q1 2026 net margin of 12% is a positive sign, but one quarter does not confirm a trend, especially when past quarters have shown significant fluctuations.
A careful skeptic might argue that both Opus and I are underestimating the potential impact of broader market and health trends on PepsiCo's business model. With increasing health consciousness and the impact of GLP-1 drugs potentially reducing demand for sugary and high-calorie snacks, PepsiCo might face more sustained challenges than currently anticipated. This could further pressure margins and growth prospects, making even the $115-$125 fair value range optimistic without substantial operational improvements or strategic shifts.