📈 Stock Analysis: PEP
PepsiCo Inc
Sector: Consumer Staples | Industry: Beverages
Market Cap: $ 205 Bn
Price: $ 153
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D Composite Grade
Composite Score: 42.00 (Percentile: 59.00%)
12 Month Price
Stock Grades
A+ MOAT
PepsiCo’s moat stems from its powerful brand portfolio, global distribution network, and unmatched diversification across snacks and beverages. With iconic brands like Frito-Lay, Gatorade, Doritos, and Pepsi, the company enjoys deep customer loyalty and strong shelf space presence worldwide. Its dual strength in both food and drinks provides resilience against consumer shifts and macroeconomic cycles—something few rivals can match. Strategic control of its supply chain, from raw materials to retail execution, reinforces efficiency and operational control. This broad-based moat allows PepsiCo to command pricing power, maintain steady margins, and fend off competitors across multiple product categories.
E FUNDAMENTALS
| Metric | Value | Check |
|---|---|---|
| Net Profit Margin | 10% | ✅ |
| EPS Growth (3Y | 5Y) | 7% | 6% | ✅ |
| Revenue Growth (3Y | 5Y) | 5% | 6% | ✅ |
| Forecasted EPS Growth (5Y) | 4% | ✅ |
| Forecasted Revenue Growth (1Y) | 2% |
B FINANCIAL
| Metric | Value | Check |
|---|---|---|
| ROE | 37% | ✅ |
| ROIC | 10% | ✅ |
| Debt/Equity | 2.28 | ❌ |
| Capital Allocation | Strong | ✅ |
C VALUATION
| Metric | Value | Check |
|---|---|---|
| Fair Value | 164 | ✅ |
| P/Earnings (TTM) | 29 | ❌ |
| P/Earnings Forecasted | 19 | ✅ |
| P/CashFlow | 16 | ✅ |
| PEG TTM | 7.93 | ❌ |
| Stock Buyback (5Y, 10Y) | 1%, 7% | ❌ |
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INVESTMENT COMMENTARY
PepsiCo (PEP) represents a high-quality, long-term compounder that aligns well with Buffett-style principles—steady growth, wide moat, and consistent capital returns. Its unique strength lies in its diversified portfolio, which includes both beverages and snacks—a strategic advantage that cushions earnings across market cycles.
With strong brands like Gatorade, Frito-Lay, and Pepsi, the company enjoys pricing power and global scale. Financially, PepsiCo delivers reliable free cash flow, a high return on equity, and disciplined shareholder returns through dividends and buybacks. While it carries more debt than some peers, its cash flow comfortably supports obligations and long-term investments.
Though not a high-growth tech story, PepsiCo’s consistent performance, modest valuation, and brand resilience make it an ideal candidate for long-term investors seeking stability, income, and slow-but-steady capital appreciation. At current levels, PEP is a reliable hold—and an attractive buy on dips.