PEPPepsiCo
Is the business good?
The checks split: earnings fully cash-backed (1.2×) and margins widening, but returns that lean on debt.
Mixed fundamental signals. Nine pass/fail tests of year-over-year health from the filings.
Operating profit is fully backed by cash. Conversion is worsening vs a year ago.
Positive operating leverage, operating profit is growing faster than sales, so margins widen as the business scales.
Leverage-amplified, a high assets-to-equity ratio does much of the work. ROE 44% = margin × turnover × leverage.
Unless marked, from derived.
Against the whole market›
Percentile against every name Ryufin tracks. Higher is better; the tick marks the middle of the market. Context, not one of the checks above.
Where this answer is blind. The F-score rewards improvement, so an already-elite company can score mid-pack.
How good a business is PEP?
PepsiCo earns 19% on the capital it employs against a 9.0% cost of capital, so the business is worth more the bigger it gets.
Return on invested capital · cost of capital 9.0% · 9.9 points above what the capital costs: growth creates value
- Operating margin
- 15%
Operating margin · Beverages - Non-Alcoholic median 17% · 12 months to Q3 2026
- Cash conversion
- 1.21×
Cash conversion · 1.44× a year ago · operating cash flow covers the operating profit after tax
- Share count, year on year
- −0.36%
Share count, year on year · flat: no meaningful dilution
| Year | Operating margin |
|---|---|
| FY2020 | 14% |
| FY2021 | 14% |
| FY2022 | 13% |
| FY2023 | 13% |
| FY2024 | 14% |
| FY2025 | 12% |
Details›
- Gross margin12 months to Q3 2026
- 54%
- Operating margin12 months to Q3 2026
- 15%
- Net margin12 months to Q3 2026
- 11%
- Free cash flow margin
- 11%
- Revenue, trailing twelve months
- $98.2B
- Free cash flow, trailing twelve months
- $10.5B
- Net income, trailing twelve months
- $10.9B
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 19%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion is operating cash flow over operating profit after tax.
Customers and suppliers
Who buys from PEP and who it buys from, as the companies report it.
- WMTWalmart14%
Share of revenue · FY2025 10-K
- CELHCelsius Holdings, Inc.43%
PEP is 43% of its revenue · FY2025 10-K
- MKCMcCormick & Company12%
PEP is 12% of its revenue · FY2025 10-K
A company has to disclose every customer behind 10% or more of its revenue. Each share comes from the latest annual report of the company that states it and shows on both companies’ pages; PEP’s own figures are from its FY2025 10-K. Smaller customers and suppliers go unreported.
Beverages, Non-Alcoholic
The closest names by size in the same industry