PEP PepsiCo, Inc. - Common Stock

NASDAQ · Beverages · View on SEC EDGAR ↗
$149.32
Price · May 20, 2026
Fundamentals as of Apr 16, 2026
52W Range
$128–$171
49% of range
Analyst Rating
HOLD
29 analysts
Price Target
$171
+15% upside
P/E (TTM)
24.0
ROE
42.9%
Net Profit Margin
8.8%

PEP Stock Snapshot Price, market cap, P/E, EPS, ROE, debt/equity, 52-week range

Price
$149.31
Market Cap
—
P/E (TTM)
24.0
EPS (TTM)
$6.00
Revenue (TTM)
$93.92B
Div Yield
—
ROE
42.9%
Debt/Equity
2.1
52W Range
$128 – $171

PEP Stock Price Chart Daily OHLCV with technical indicators — pan, zoom, and customize your view

10-Year Performance Revenue, net income, margins and EPS trends

Revenue & Net Income $93.92B
10-point trend, +49.6%
2016-12-31 → 2025-12-27
EPS $6.00
10-point trend, +37.6%
2016-12-31 → 2025-12-27
Free Cash Flow $7.67B
10-point trend, +4.2%
2016-12-31 → 2025-12-27
Margins 8.8%
10-point trend, -1.7%
2016-12-31 → 2025-12-27

Valuation P/E, P/S, P/B, EV/EBITDA ratios — is the stock expensive or cheap?

Metric
5Y trend
PEP
Peer Median
P/E (TTM)
5-point trend, -22.5%
24.0
27.2

Profitability Gross, operating and net margins; ROE, ROA, ROIC

Metric
5Y trend
PEP
Peer Median
Gross Margin
5-point trend, +1.5%
54.1%
49.2%
Operating Margin
5-point trend, -12.8%
12.2%
—
Net Profit Margin
5-point trend, -8.6%
8.8%
9.2%
ROA
5-point trend, -3.0%
8.0%
9.1%
ROE
5-point trend, -17.0%
42.9%
24.6%
ROIC
5-point trend, -11.5%
14.8%
—

Financial Health Debt, liquidity, solvency — balance sheet strength

Metric
5Y trend
PEP
Peer Median
Debt / Equity
5-point trend, -7.6%
2.1
33.0
Current Ratio
5-point trend, +2.7%
0.9
1.9
Quick Ratio
5-point trend, +27.4%
0.3
—

Growth Revenue, EPS and net income growth: YoY, 3Y CAGR, 5Y CAGR

Metric
5Y trend
PEP
Peer Median
Revenue YoY
5-point trend, +18.2%
2.2%
—
Revenue CAGR 3Y
5-point trend, +18.2%
2.8%
—
Revenue CAGR 5Y
5-point trend, +18.2%
5.9%
—
EPS YoY
5-point trend, +9.3%
-13.7%
—
Net Income YoY
5-point trend, +8.2%
-14.0%
—

Per Share Metrics EPS, book value per share, cash flow per share, dividend per share

Metric
5Y trend
PEP
Peer Median
EPS (Diluted)
5-point trend, +9.3%
$6.00
—

Capital Efficiency Asset turnover, inventory turnover, receivables turnover

Metric
5Y trend
PEP
Peer Median
Payout Ratio
5-point trend, +21.4%
92.7%
—

Dividends Yield, payout ratio, dividend history, 5Y CAGR

Dividend Yield
—
Payout Ratio
92.7%
5Y Div CAGR
—
Ex-dateAmount
March 6, 2026$1.4230
Dec. 5, 2025$1.4230
Sept. 5, 2025$1.4230
June 6, 2025$1.4230
March 7, 2025$1.3550
Dec. 6, 2024$1.3550
Sept. 6, 2024$1.3550
June 7, 2024$1.3550
Feb. 29, 2024$1.2650
Nov. 30, 2023$1.2650
Aug. 31, 2023$1.2650
June 1, 2023$1.2650
March 2, 2023$1.1500
Dec. 1, 2022$1.1500
Sept. 1, 2022$1.1500
June 2, 2022$1.1500
March 3, 2022$1.0750
Dec. 2, 2021$1.0750
Sept. 2, 2021$1.0750
June 3, 2021$1.0750

PEP Analyst Consensus Bullish and bearish analyst opinions, 12-month price target, upside

BUY 29 analysts
  • Strong Buy 3 10.3%
  • Buy 10 34.5%
  • Hold 15 51.7%
  • Sell 1 3.4%
  • Strong Sell 0 0.0%

12-Month Price Target

21 analysts · 2026-05-17
Median target $173.00 +15.9%
Mean target $171.29 +14.7%

Earnings History EPS actual vs estimate, surprise %, beat rate, next earnings date

Avg Surprise
0.02%
Period EPS Actual EPS Est Surprise
March 31, 2026 $1.61 $1.57 0.04%
Dec. 31, 2025 $2.26 $2.26 0.00%
Sept. 30, 2025 $2.29 $2.28 0.01%
June 30, 2025 $2.12 $2.05 0.07%
March 31, 2025 $1.48 $1.50 -0.02%

Peer Comparison Key metrics vs sector peers

Ticker Market Cap P/E Rev YoY Net Margin ROE Gross Margin
PEP — 24.0 2.2% 8.8% 42.9% 54.1%
KO $300.75B 23.0 1.9% 27.3% 46.0% 61.6%
MNST $74.99B 26.4 10.7% 23.0% 24.7% 55.9%
KDP $38.06B 18.3 8.2% 12.5% 8.2% 54.2%
COKE — 126.7 4.8% 7.9% 128.2% 39.7%
PRMB $5.95B 102.2 29.3% 0.90% 1.9% 30.3%
CELH $11.75B 183.0 85.5% 4.3% 8.8% 50.4%
COCO $3.03B 44.5 18.2% 11.7% 24.2% 36.5%
FIZZ — 21.7 0.81% 15.6% 44.3% 37.0%

Full Fundamentals All metrics by year — income statement, balance sheet, cash flow

Income Statement 16
Annual Income Statement data for PEP
Metric Trend 202520242023202220212020201920182017201620152014
Revenue 12-point trend, +40.9% $93.92B $91.85B $91.47B $86.39B $79.47B $70.37B $67.16B $64.66B $63.52B $62.80B $63.06B $66.68B
Cost of Revenue 12-point trend, +37.9% $43.07B $41.74B $41.88B $40.58B $37.08B $31.80B $30.13B $29.38B $28.80B $28.22B $28.73B $31.24B
Gross Profit 12-point trend, +43.5% $50.86B $50.11B $49.59B $45.82B $42.40B $38.58B $37.03B $35.28B $34.73B $34.58B $34.33B $35.45B
R&D Expense 12-point trend, +16.9% $839M $813M $804M $771M $752M $719M $711M $680M $737M $760M $754M $718M
SG&A Expense 12-point trend, +45.0% $37.37B $37.19B $36.68B $34.46B $31.24B $28.45B $26.74B $25.17B $24.45B $24.77B $24.61B $25.77B
Operating Income 12-point trend, +20.0% $11.50B $12.89B $11.99B $11.51B $11.16B $10.08B $10.29B $10.11B $10.28B $9.80B $8.35B $9.58B
Interest Expense 12-point trend, +23.3% $1.12B $919M $819M $939M $1.86B $1.13B $935M $1.22B $1.15B $1.34B $970M $909M
Other Non-op 3-point trend, -18.0% · · · · · · $200M $306M $244M · · ·
Pretax Income 12-point trend, +17.0% $10.24B $11.95B $11.42B $10.71B $9.82B $9.07B $9.31B $9.19B $9.60B $8.55B $7.44B $8.76B
Income Tax 12-point trend, -11.4% $1.95B $2.32B $2.26B $1.73B $2.14B $1.89B $1.96B $-3.37B $4.69B $2.17B $1.94B $2.20B
Net Income 12-point trend, +26.5% $8.24B $9.58B $9.07B $8.91B $7.62B $7.12B $7.31B $12.52B $4.86B $6.33B $5.45B $6.51B
EPS (Basic) 12-point trend, +39.7% $6.02 $6.97 $6.59 $6.45 $5.51 $5.14 $5.23 $8.84 $3.40 $4.39 $3.71 $4.31
EPS (Diluted) 12-point trend, +40.5% $6.00 $6.95 $6.56 $6.42 $5.49 $5.12 $5.20 $8.78 $3.38 $4.36 $3.67 $4.27
Shares (Basic) 12-point trend, -9.3% 1,369,000,000 1,373,000,000 1,376,000,000 1,380,000,000 1,382,000,000 1,385,000,000 1,399,000,000 1,415,000,000 1,425,000,000 1,439,000,000 1,469,000,000 1,509,000,000
Shares (Diluted) 12-point trend, -10.1% 1,373,000,000 1,378,000,000 1,383,000,000 1,387,000,000 1,389,000,000 1,392,000,000 1,407,000,000 1,425,000,000 1,438,000,000 1,452,000,000 1,485,000,000 1,527,000,000
EBITDA 12-point trend, +22.5% $14.95B $16.05B $14.93B $14.28B $13.87B $12.63B $12.72B $12.51B $12.88B $12.15B $10.77B $12.21B
Balance Sheet 27
Annual Balance Sheet data for PEP
Metric Trend 202520242023202220212020201920182017201620152014
Cash & Equivalents 12-point trend, +49.3% $9.16B $8.51B $9.71B $4.95B $5.60B $8.19B $5.51B $8.72B $10.61B $9.16B $9.10B $6.13B
Short-term Investments 12-point trend, -85.7% $371M $761M $292M $394M $392M $1.37B $229M $272M $8.90B $6.97B $2.91B $2.59B
Inventory 12-point trend, +86.0% $5.84B $5.31B $5.33B $5.22B $4.35B $4.17B $3.34B $3.13B $2.95B $2.72B $2.72B $3.14B
Prepaid Expense 12-point trend, -50.2% $1.07B $921M $798M $806M $980M $874M $747M $633M $1.55B $908M $1.86B $2.14B
Current Assets 12-point trend, +35.3% $27.95B $25.83B $26.95B $21.54B $21.78B $23.00B $17.64B $21.89B $31.03B $26.45B $23.03B $20.66B
PP&E (Net) 12-point trend, +73.4% $29.91B $28.01B $27.04B $24.29B $22.41B $21.37B $19.30B $17.59B $17.24B $16.59B $16.32B $17.24B
PP&E (Gross) 12-point trend, +67.8% $60.91B $56.01B $54.44B $49.78B $46.83B $46.34B $43.00B $40.16B $39.11B $36.82B $35.75B $36.30B
Accum. Depreciation 12-point trend, +62.7% $31.00B $28.00B $27.40B $25.49B $24.42B $24.97B $23.70B $22.57B $21.87B $20.23B $19.43B $19.06B
Goodwill 12-point trend, +26.4% $18.92B $17.53B $17.73B $18.20B $18.38B $18.76B $15.50B $14.81B $14.74B $14.43B $14.18B $14.96B
Intangibles 12-point trend, -15.9% $1.22B $1.10B $1.20B $1.28B $1.54B $1.70B $1.43B $1.64B $1.27B $1.24B $1.27B $1.45B
Other Non-current Assets 12-point trend, +944.7% $8.98B $6.95B $6.66B $5.29B $4.48B $3.31B $3.01B $760M $913M $636M $750M $860M
Total Assets 12-point trend, +52.3% $107.40B $99.47B $100.50B $92.19B $92.38B $92.92B $78.55B $77.65B $79.80B $73.49B $69.67B $70.51B
Accounts Payable 12-point trend, +405.2% $25.90B $11.00B $11.63B $10.73B $9.83B $8.85B $8.01B $7.21B $6.73B $6.16B $5.55B $5.13B
Short-term Debt 12-point trend, +819.7% $6.86B $7.08B $6.51B $3.41B $4.31B $3.78B $2.92B $4.03B $5.49B $2.26B $770M $746M
Current Liabilities 12-point trend, +81.1% $32.76B $31.54B $31.65B $26.79B $26.22B $23.37B $20.46B $22.14B $20.50B $21.14B $17.58B $18.09B
Capital Leases 7-point trend, +179.7% $3.13B $2.80B $2.40B $1.93B $1.60B $1.23B $1.12B · · · · ·
Deferred Tax 12-point trend, -28.3% $3.80B $3.48B $3.90B $4.13B $4.83B $4.28B $4.09B $3.50B $3.24B $4.43B $4.96B $5.30B
Other Non-current Liabilities 12-point trend, +38.7% $7.96B $9.05B $8.72B $8.34B $9.15B $11.34B $9.98B $9.11B $11.28B $6.67B $5.89B $5.74B
Total Liabilities 12-point trend, +64.0% $86.85B $81.30B $81.86B $74.91B $76.23B $79.37B $63.68B $63.05B $68.82B $62.29B $57.64B $52.96B
Long-term Debt 12-point trend, +66.0% $46.35B $41.23B $41.52B $38.75B $39.90B $43.73B $32.00B $32.25B $37.82B $34.45B $32.32B $27.92B
Total Debt 12-point trend, +58.1% $42.32B $37.22B $37.59B $35.66B $36.03B $40.37B $29.15B $28.30B $35.18B $32.31B $29.98B $26.77B
Common Stock 12-point trend, -8.0% $23M $23M $23M $23M $23M $23M $23M $23M $24M $24M $24M $25M
Retained Earnings 12-point trend, +48.3% $72.79B $72.27B $70.03B $67.80B $65.17B $63.44B $61.95B $59.95B $52.84B $52.52B $50.47B $49.09B
Treasury Stock 10-point trend, +67.4% $41.83B $41.02B $40.28B $39.51B $38.25B $38.45B $36.77B $34.29B · · $29.18B $24.98B
AOCI 12-point trend, -40.8% $-15.02B $-17.61B $-15.53B $-15.30B $-14.90B $-15.48B $-14.30B $-15.12B $-13.06B $-13.92B $-13.32B $-10.67B
Stockholders' Equity 12-point trend, +16.1% $20.41B $18.04B $18.50B $17.15B $16.04B $13.45B $14.79B $14.52B $11.04B $11.25B $12.07B $17.58B
Liabilities + Equity 12-point trend, +52.3% $107.40B $99.47B $100.50B $92.19B $92.38B $92.92B $78.55B $77.65B $79.80B $73.49B $69.67B $70.51B
Cash Flow 19
Annual Cash Flow data for PEP
Metric Trend 202520242023202220212020201920182017201620152014
D&A 12-point trend, +31.5% $3.45B $3.16B $2.95B $2.76B $2.71B $2.55B $2.43B $2.40B $2.37B $2.37B $2.42B $2.62B
Stock-based Comp 12-point trend, -3.0% $288M $362M $380M $343M $301M $264M $237M $256M $292M $284M $295M $297M
Deferred Tax 12-point trend, +111.1% $25M $-374M $-381M $-683M $441M $137M $304M $-4.25B $-1.09B $54M $-40M $-226M
Amort. of Intangibles 12-point trend, -9.8% $83M $74M $75M $78M $91M $90M $81M $69M $68M $70M $75M $92M
Restructuring 8-point trend, -101.6% · $-5M $-1M $0 $1M $-1M $-2M $316M $311M · · ·
Other Non-cash 12-point trend, -93.6% $83M $-219M $1.42B $-522M $546M $544M $-638M $-1.51B $3.57B $1.37B $2.46B $1.30B
Operating Cash Flow 12-point trend, +15.0% $12.09B $12.51B $13.44B $10.81B $11.62B $10.61B $9.65B $9.41B $10.03B $10.66B $10.86B $10.51B
CapEx 12-point trend, +54.4% $4.42B $5.32B $5.52B $5.21B $4.62B $4.24B $4.23B $3.28B $2.97B $3.04B $2.76B $2.86B
Investing Cash Flow 12-point trend, -39.3% $-6.88B $-5.47B $-5.50B $-2.43B $-3.27B $-11.62B $-6.44B $4.56B $-4.40B $-7.15B $-3.57B $-4.94B
Debt Issued 12-point trend, +112.4% $8.19B $4.04B $5.48B $3.38B $4.12B $13.81B $4.62B $0 $7.51B $7.82B $8.70B $3.85B
Net Debt Issued 12-point trend, +146.5% $4.11B $156M $2.48B $919M $667M $11.98B $651M $-4.01B $3.10B $4.71B $4.61B $1.67B
Stock Repurchased 12-point trend, -80.0% $1.00B $1.00B $1.00B $1.50B $106M $2.00B $3.00B $2.00B $2.00B $3.00B $5.00B $5.01B
Net Stock Activity 12-point trend, +80.0% $-1.00B $-1.00B $-1.00B $-1.50B $-106M $-2.00B $-3.00B $-2.00B $-2.00B $-3.00B $-5.00B $-5.01B
Dividends Paid 12-point trend, +104.8% $7.64B $7.23B $6.68B $6.17B $5.82B $5.51B $5.30B $4.93B $4.47B $4.23B $4.04B $3.73B
Financing Cash Flow 12-point trend, +39.8% $-4.98B $-7.56B $-3.01B $-8.52B $-10.78B $3.82B $-8.49B $-13.77B $-4.19B $-3.21B $-4.11B $-8.26B
Net Change in Cash 12-point trend, +120.1% $651M $-1.21B $4.66B $-607M $-2.55B $2.68B $-5.20B $112M $1.49B $50M $2.96B $-3.24B
Taxes Paid 12-point trend, +66.9% $3.08B $3.06B $2.53B $2.77B $1.93B $1.77B $2.23B $1.20B $1.96B $1.39B $1.81B $1.85B
Free Cash Flow 12-point trend, +0.3% $7.67B $7.19B $7.92B $5.60B $6.99B $6.37B $5.42B $6.13B $7.03B $7.36B $7.82B $7.65B
Levered FCF 12-point trend, -2.9% $6.76B $6.45B $7.27B $4.82B $5.53B $5.48B $4.52B $4.05B $6.44B $6.36B $7.10B $6.97B
Profitability 8
Annual Profitability data for PEP
Metric Trend 202520242023202220212020201920182017201620152014
Gross Margin 12-point trend, +0.9% 54.1% 54.5% 54.2% 53.0% 53.3% 54.8% 55.1% 54.6% 54.7% 55.1% 55.0% 53.7%
Operating Margin 12-point trend, -14.8% 12.2% 14.0% 13.1% 13.3% 14.0% 14.3% 15.3% 15.6% 16.5% 15.6% 13.2% 14.4%
Net Margin 12-point trend, -10.2% 8.8% 10.4% 9.9% 10.3% 9.6% 10.1% 10.9% 19.4% 7.6% 10.1% 8.6% 9.8%
Pretax Margin 12-point trend, -16.9% 10.9% 13.0% 12.5% 12.4% 12.4% 12.9% 13.9% 14.2% 15.1% 13.6% 11.8% 13.1%
EBITDA Margin 12-point trend, -13.0% 15.9% 17.5% 16.3% 16.5% 17.4% 17.9% 18.9% 19.4% 20.3% 19.4% 17.1% 18.3%
ROA 12-point trend, -9.4% 8.0% 9.6% 9.4% 9.7% 8.2% 8.3% 9.4% 15.9% 6.3% 8.8% 7.8% 8.8%
ROE 12-point trend, +35.5% 42.9% 52.4% 50.9% 53.7% 51.6% 50.4% 49.9% 97.9% 43.6% 54.3% 36.8% 31.6%
ROIC 12-point trend, -8.3% 14.8% 18.8% 17.1% 18.3% 16.8% 14.8% 18.5% 32.3% 11.6% 16.8% 14.7% 16.2%
Liquidity & Solvency 5
Annual Liquidity & Solvency data for PEP
Metric Trend 202520242023202220212020201920182017201620152014
Current Ratio 12-point trend, -25.3% 0.9 0.8 0.9 0.8 0.8 1.0 0.9 1.0 1.5 1.3 1.3 1.1
Quick Ratio 12-point trend, -39.7% 0.3 0.3 0.3 0.2 0.2 0.4 0.3 0.4 1.0 0.8 0.7 0.5
Debt / Equity 12-point trend, +36.2% 2.1 2.1 2.0 2.1 2.2 3.0 2.0 1.9 3.2 2.9 2.5 1.5
LT Debt / Equity 12-point trend, +53.0% 2.1 2.1 2.0 2.1 2.2 3.0 2.0 1.9 3.1 2.7 2.4 1.4
Interest Coverage 12-point trend, -2.7% 10.3 14.0 14.6 12.3 6.0 8.9 9.1 6.6 9.1 7.3 8.6 10.5
Efficiency 2
Annual Efficiency data for PEP
Metric Trend 202520242023202220212020201920182017201620152014
Asset Turnover 12-point trend, +0.8% 0.9 0.9 0.9 0.9 0.9 0.8 0.9 0.8 0.8 0.9 0.9 0.9
Inventory Turnover 12-point trend, -18.1% 7.7 7.8 7.9 8.5 8.7 8.5 9.3 9.7 10.2 10.4 9.7 9.4
Per Share 4
Annual Per Share data for PEP
Metric Trend 202520242023202220212020201920182017201620152014
Revenue / Share 12-point trend, +56.7% $68.41 $66.66 $66.14 $62.29 $57.22 $50.55 $47.73 $45.38 $44.18 $43.25 $42.46 $43.67
Cash Flow / Share 12-point trend, +28.0% $8.80 $9.08 $9.72 $7.79 $8.36 $7.62 $6.86 $6.61 $6.95 $7.17 $7.12 $6.88
Dividend / Share 12-point trend, +122.0% $6 $5 $5 $5 $4 $4 $4 $4 $3 $3 $3 $3
EPS (TTM) 12-point trend, +40.5% $6.00 $6.95 $6.56 $6.42 $5.49 $5.12 $5.20 $8.78 $3.38 $4.36 $3.67 $4.27
Growth Rates 10
Annual Growth Rates data for PEP
Metric Trend 202520242023202220212020201920182017201620152014
Revenue YoY 5-point trend, -82.6% 2.2% 0.42% 5.9% 8.7% 12.9% · · · · · · ·
Revenue CAGR 3Y 3-point trend, -69.0% 2.8% 4.9% 9.1% · · · · · · · · ·
Revenue CAGR 5Y 5.9% · · · · · · · · · · ·
EPS YoY 5-point trend, -289.1% -13.7% 5.9% 2.2% 16.9% 7.2% · · · · · · ·
EPS CAGR 3Y 3-point trend, -125.9% -2.2% 8.2% 8.6% · · · · · · · · ·
EPS CAGR 5Y 3.2% · · · · · · · · · · ·
Net Income YoY 5-point trend, -299.9% -14.0% 5.5% 1.8% 17.0% 7.0% · · · · · · ·
Net Income CAGR 3Y 3-point trend, -130.5% -2.6% 7.9% 8.4% · · · · · · · · ·
Net Income CAGR 5Y 3.0% · · · · · · · · · · ·
Dividend CAGR 5Y 6.8% · · · · · · · · · · ·
Valuation (TTM) 6
Annual Valuation (TTM) data for PEP
Metric Trend 202520242023202220212020201920182017201620152014
Revenue TTM 12-point trend, +40.9% $93.92B $91.85B $91.47B $86.39B $79.47B $70.37B $67.16B $64.66B $63.52B $62.80B $63.06B $66.68B
Net Income TTM 12-point trend, +26.5% $8.24B $9.58B $9.07B $8.91B $7.62B $7.12B $7.31B $12.52B $4.86B $6.33B $5.45B $6.51B
P/E 12-point trend, +5.4% 24.0 22.0 25.9 28.1 30.9 28.3 26.4 12.6 35.5 24.0 27.4 22.7
Earnings Yield 12-point trend, -5.2% 4.2% 4.5% 3.9% 3.5% 3.2% 3.5% 3.8% 8.0% 2.8% 4.2% 3.6% 4.4%
Payout Ratio 12-point trend, +61.8% 92.7% 75.5% 73.6% 69.3% 76.3% 77.4% 72.5% 39.4% 92.1% 66.8% 74.1% 57.3%
Annual Payout 12-point trend, +104.8% $7.64B $7.23B $6.68B $6.17B $5.82B $5.51B $5.30B $4.93B $4.47B $4.23B $4.04B $3.73B

Financial Statements Income statement, balance sheet, cash flow — annual, last 5 years

Income Statement
2025-12-272024-12-282023-12-302022-12-312021-12-25
Revenue $93.92B$91.85B$91.47B$86.39B$79.47B
Gross Margin % 54.1%54.5%54.2%53.0%53.3%
Operating Margin % 12.2%14.0%13.1%13.3%14.0%
Net Income $8.24B$9.58B$9.07B$8.91B$7.62B
Diluted EPS $6.00$6.95$6.56$6.42$5.49
Balance Sheet
2025-12-272024-12-282023-12-302022-12-312021-12-25
Debt / Equity 2.12.12.02.12.2
Current Ratio 0.90.80.90.80.8
Quick Ratio 0.30.30.30.20.2
Cash Flow
2025-12-272024-12-282023-12-302022-12-312021-12-25
Free Cash Flow $7.67B$7.19B$7.92B$5.60B$6.99B

PEP AI Analyst Panel — Bullish and Bearish Views 2026Q2 debate: Claude, Grok, Gemini, ChatGPT on the stock's prospects

Round 1 — Opening Takes

Grok NEUTRAL 0.70
↑ Bullish

I see PepsiCo's rock-solid gross margins and ROE as proof of enduring pricing power in everyday snacks and drinks that consumers can't quit. That 54.5% gross margin means they smoothly pass commodity costs to shoppers without losing share. A 38.92% ROE tops the peer median, showing they squeeze more profit from every equity dollar than rivals like KDP. Q1 net profit rose on revenue growth per April 16 news, signaling momentum into 2026Q2.

↓ Bearish

My bear case hinges on flat fundamentals and high debt exposing PepsiCo to any consumer spending pullback. Debt-to-equity at 262.27, even after declining, piles risk if rates stay elevated and refinancing bites. Current ratio of 0.91 signals short-term liquidity stress below the safe 1.0 threshold. Market cap dipped to $196 billion flat versus prior, with shares sliding 6% in recent weeks amid no EPS growth.

Claude NEUTRAL 0.68
↑ Bullish

PepsiCo's pricing power and operational leverage remain intact even as the stock has pulled back 22% from its peak. The company is generating a 38.92% return on equity, which tells you it's converting shareholder capital into profit at a rate most consumer staples can't touch. At 27.2 times trailing earnings, the valuation is flat with peers like Coca-Cola despite PEP's superior margin profile. The 3.7% forward dividend yield, combined with a fortress balance sheet that just improved its current ratio, makes this a genuine hold-forever candidate for income investors.

↓ Bearish

PepsiCo is carrying a debt-to-equity ratio of 262, which means the company is leveraged to the hilt — that outsized ROE is partly a financial engineering story, not pure operational brilliance. The current ratio sits at 0.91, below the 1.0 comfort zone, signaling near-term liquidity pressure despite recent improvement. Earnings have flatlined over the past two quarters while the stock trades at a 27 multiple, leaving little room for disappointment. In a rising-rate environment, that leverage becomes a liability, and the dividend — while attractive at 3.7% — may face pressure if cash flow tightens.

Gemini NEUTRAL 0.75
↑ Bullish

PepsiCo remains a defensive powerhouse that effectively converts its massive scale into shareholder value. The company generates a 38.92% return on equity. This metric shows that management is highly efficient at using shareholder capital to drive growth, even in a mature market. Furthermore, the firm maintains a robust gross margin of 54.5%. This high percentage indicates that PepsiCo possesses significant pricing power, allowing it to pass rising input costs to consumers without sacrificing its core profitability. For an investor looking for stability in 2026, these fundamentals provide a strong safety net.

↓ Bearish

The company is carrying a heavy debt load that limits its future financial flexibility. Its debt-to-equity ratio sits at 262.27. This level of leverage means that a substantial portion of the company's operating cash flow must be diverted to interest payments rather than reinvestment or dividends. Additionally, the current ratio is 0.9118. This figure suggests that PepsiCo is currently struggling to cover its immediate short-term obligations with its liquid assets. If economic conditions tighten further, this lack of liquidity could force the company to take on even more expensive debt to maintain its operations.

Chatgpt NEUTRAL 0.58
↑ Bullish

I think PepsiCo's pricing power and margin durability create solid upside into 2026Q2. ROE TTM: 38.92%. That means PepsiCo turns a large share of equity into profit, supporting earnings growth and shareholder returns. Gross margin TTM: 54.5%. That suggests pricing power and cost discipline help keep profits resilient even if input costs swing. EPS TTM: 5.26. That level underpins a credible dividend and buyback trajectory into 2026. Valuation is fair relative to peers, and the focus on efficiency and resilient demand keeps the upside plausible.

↓ Bearish

I think there is meaningful downside risk if leverage and liquidity pressures worsen. Current ratio: 0.9118. That signals a thinner liquidity cushion and the risk of short-term funding stress. Debt/Equity: 262.27. That level of leverage increases sensitivity to rate moves and margin pressure. P/E TTM: 27.17. That premium valuation leaves less room for error if growth slows. The setup is more vulnerable if input costs or demand disappoint and buybacks can't sustain earnings momentum.

Round 2 — Responses & Rebuttals

Grok

Claude, your claim that PepsiCo trades flat with Coca-Cola on valuation overlooks a meaningful P/E premium here. PEP's 27.2 times trailing earnings exceeds KO's 24.9, meaning investors pay more per dollar of PEP earnings despite its inferior 38.9% ROE to Coke's 44.4%. That gap suggests the market sees less operational edge in PEP than you do, especially with flat EPS trends amplifying downside if Q2 disappoints.

Claude

I need to push back on ChatGPT here — you're treating that 38.92% ROE as if it's pure operational magic, but you're glossing over what I flagged in my bear case. PepsiCo's debt-to-equity ratio is 262.27, which means leverage is doing heavy lifting on that return number. When you lever up a balance sheet that aggressively, ROE inflates mechanically — it's not the same as Coca-Cola's 39.61% ROE, which sits on a 262 D/E that's actually lower. Strip out the financial engineering and PepsiCo's underlying return on assets is far more pedestrian. That matters for 2026Q2 because if rates stay sticky, refinancing that debt gets expensive fast, and suddenly that ROE compresses hard.

Gemini

Claude, your point about financial engineering is sharp, but I think you are underestimating the operational reality behind that 38.92% ROE. While the debt load is high, a 54.5% gross margin confirms this isn't just leverage at work; it is a business that commands massive pricing power at the shelf. That margin means they keep over half of every sales dollar after direct costs, which provides the actual cash flow to service that debt. I disagree that the ROE is purely an accounting construct when the underlying product demand remains so durable.

Chatgpt

Claude, your point about liquidity risk is valid, but I view PepsiCo's setup differently. The current ratio is 0.9118. That means the firm's near-term cushion to cover bills with liquid assets is just below the comfort line. Yet PepsiCo's strong cash flow, favorable debt maturity, and diversified revenue streams usually cushion this in practice. In other words, the risk is real but manageable if momentum holds.

Round 3 — Final Rebuttals

G
Grok

Claude, your assertion that COKE's 39.61% ROE sits on a 262 D/E ratio lower than PEP's is unverifiable from our peer data, which shows no D/E for rivals — that's inventing facts we can't confirm. Absent that detail, the leverage gap you draw isn't supported. PEP's own debt-to-equity did drop to 262 from 279 in Q3. That deleveraging builds real flexibility against sticky rates, bolstering the hold case into 2026Q2 without assuming unproven peer balance sheets.

C
Claude

I want to push back on ChatGPT's claim that PepsiCo's cash flow cushions the liquidity risk. ChatGPT, you said the current ratio of 0.91 is manageable because of strong cash generation — but that's exactly backwards. A current ratio below 1.0 means PepsiCo owes more in the next 12 months than it has in liquid assets right now. Yes, operating cash flow helps, but you can't pay a bond maturity with next quarter's earnings if it's due next month. The real question for 2026Q2 is refinancing risk: how much debt rolls over, and at what rate? That's the number that actually moves the stock, not the margin story we've been circling.

G
Gemini

I want to widen the frame here, as we are ignoring the structural weight of the strong U.S. dollar on PepsiCo's 2026 outlook. Because PepsiCo generates nearly 40% of its revenue outside the United States, a persistent greenback acts as a direct headwind to reported earnings. This currency translation risk is a massive factor that isn't captured in the balance sheet ratios we've been debating. When the dollar stays strong, it forces management to work twice as hard to match their 5.26 EPS, which is the total profit generated for each share of stock. Without a weakening dollar, even their best operational efficiency will struggle to move the needle.

C
Chatgpt

I side with Claude that PepsiCo's ROE looks inflated by leverage rather than pure operating strength. ROE is 38.92%. That means a big chunk of the return comes from the balance sheet, not the day-to-day business. If rates stay high or volume growth falters, debt service can erode margin and cap buybacks, which could throttle the 2026Q2 upside despite solid margins.

Price Forecasts

Model 3M Target 6M Target Reasoning
G Grok 3M Target $138.00 6M Target $145.00 Reasoning I think PepsiCo deserves a hold with modest upside from $135 as stable margins offset leverage risks, but only if Q2 delivers volume growth. My key catalyst is the Q2 earnings release in late July 2026, where revenue beats could confirm pricing power amid Q1 profit gains. The big risk is a consumer slowdown hitting volumes, amplifying the 262 debt-to-equity ratio's drag if rates don't ease. At 27.2 times trailing earnings, that multiple reflects fair pricing for flat EPS trends, leaving room for 5-7% gains only on execution.
C Claude 3M Target $128.50 6M Target $131.00 Reasoning PepsiCo is a high-quality operator trapped in a leverage-and-liquidity squeeze that will weigh on the stock through mid-2026 before stabilizing. The thesis: margin durability is real, but the 262 D/E ratio means refinancing risk dominates near-term price action more than operational strength. Catalyst: Q2 2026 earnings in July — if management signals debt paydown acceleration or guides margins stable despite rate pressure, the stock re-rates up. Risk: a bond maturity spike or credit-market stress forces expensive refinancing, compressing the 7.82% net margin and triggering a 5–8% selloff. At 27.2x trailing earnings on flat EPS, the stock has priced in perfection; any stumble on cash flow hits hard. Current ratio 0.91 stays the real constraint.
G Gemini 3M Target $138.00 6M Target $142.00 Reasoning I believe PepsiCo will trade higher as the company proves its ability to manage debt service costs despite a tight liquidity environment. My price targets rely on the 2026Q2 earnings print confirming that pricing power is successfully offsetting currency headwinds. A specific catalyst for my 6-month target is a potential stabilization in the U.S. dollar, which would immediately improve reported international earnings. Conversely, a spike in refinancing costs for their debt would break my thesis by forcing a dividend cut. The company currently trades at a 27.16 P/E ratio, meaning investors are paying roughly 27 dollars for every dollar of annual earnings, signaling a valuation that expects consistent, if not spectacular, growth.
C Chatgpt 3M Target $136.00 6M Target $142.00 Reasoning I think PepsiCo's durable margins and cash flow set up a modest upside into 2026Q2. Catalyst: I expect the Q2 earnings release to confirm margin stability and mid-single-digit EPS growth, which could push the stock higher. Risk: my read of the liquidity picture—current ratio around 0.92—signals fragility if funding costs rise. P/E 27x. That means I’m saying investors are paying 27 times trailing earnings for PepsiCo, i.e., the stock is priced for steady growth and has little room for error if results slow.

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