Upside case
Bull case
$256+64.9%
PEP would need investors to value it at roughly 30x earnings — about 12x more generous than today's 18x forward P/E. That requires meaningful multiple expansion on top of continued earnings growth.
Analysis OverviewHoldUpdated May 1, 2026
PepsiCo, Inc. (PEP) Stock Analysis
Wall Street verdict, consensus price target, and analyst rating breakdown — everything needed to frame the risk/reward at today's price.
Analyst consensus
Hold
Covering
45
analysts
16 bullish · 1 bearish · 45 covering PEP
Strong Buy
1
Buy
15
Hold
28
Sell
1
Strong Sell
0
Consensus Target
$174
+12.2% vs today
Scenario Range
$142 – $256
Model bear to bull value window
Coverage
45
Published analyst ratings
Valuation Context
17.9x
Forward P/E · Market cap $211.9B
PEP price targets
Three scenarios for where PEP stock could go
Current
~$155
Confidence
72 / 100
Updated
May 1, 2026
Where we are now
Current · $155
Bear
$142
Base
$194
Bull
$256
Market caseClosest to today
Base case
$194+25.2%
At 22x on FY1 earnings, the base case reflects a reasonable but not stretched valuation. It prices in continued growth without assuming an exceptional setup.
Stress case
Bear case
$142-8.6%
If investor confidence fades or macro conditions deteriorate, a 2x multiple contraction could push PEP down roughly 9% from where it trades now.
Not financial advice. Model confidence reflects internal scenario assumptions, not a guarantee of returns. Past performance does not predict future results.
PepsiCo, Inc.
PEP · NASDAQConsumer DefensiveBeverages - Non-AlcoholicDecember year-end
PepsiCo is a global food and beverage giant that sells iconic snack brands like Lay's and Doritos alongside its namesake soft drinks. It generates revenue primarily through its Frito-Lay North America snacks division (~50% of operating profit) and its beverage business, with the rest coming from international markets and Quaker Foods. The company's competitive moat lies in its massive scale, powerful distribution network, and portfolio of deeply entrenched household brands that command strong consumer loyalty.
Market Cap
$211.9B
Revenue TTM
$93.9B
Net Income TTM
$8.2B
Net Margin
8.8%
PEP Revenue and Earnings Performance
Quarterly beat-or-miss track record against analyst estimates, plus forward revenue and EPS outlook for the next two fiscal years.
EPS Beat Rate
92%Exceptional
12 quarters tracked
Revenue Beat Rate
58%Exceptional
vs consensus estimates
Avg EPS Surprise
+3.2%
above Street consensus
Beat / Miss Record
BeatMissLeft = EPS · Right = Revenue
Q3 2025
Q4 2025
Q1 2026
Q2 2026
Last 4 Quarters
EPS beats: 4 of 4Q3 2025
EPS
$2.12/$2.03
Revenue
$22.7B/$22.3B
Q4 2025
EPS
$2.29/$2.26
Revenue
$23.9B/$23.8B
Q1 2026
EPS
$2.26/$2.24
Revenue
$29.3B/$29.0B
Q2 2026
EPS
$1.61/$1.54
Revenue
$19.4B/$18.9B
| Quarter | EPS (Actual / Est) | EPS Surprise | Revenue (Actual / Est) | Rev Surprise |
|---|---|---|---|---|
| Q3 2025 | $2.12/$2.03 | +4.4% | $22.7B/$22.3B | +2.0% |
| Q4 2025 | $2.29/$2.26 | +1.3% | $23.9B/$23.8B | +0.4% |
| Q1 2026 | $2.26/$2.24 | +0.9% | $29.3B/$29.0B | +1.3% |
| Q2 2026 | $1.61/$1.54 | +4.5% | $19.4B/$18.9B | +2.6% |
FY1–FY2 Estimates
Revenue Outlook
FY1
$97.7B
+4.1% YoY
FY2
$100.6B
+3.0% YoY
EPS Outlook
FY1
$7.30
+21.4% YoY
FY2
$7.51
+2.9% YoY
Trailing FCF (TTM)$7.7B
FCF Margin: 8.2%
Next Earnings
—
Expected EPS
—
Expected Revenue
—
PEP beat EPS estimates in 4 of 4 tracked quarters. A perfect track record raises the bar for the upcoming report.
PEP Revenue Breakdown by Segment
Product and geographic revenue mix from the latest annual disclosure, with year-over-year growth by segment.
Latest disclosure
FY 2025
Total disclosed revenue $93.9B
Product Mix
Latest annual revenue by segment or product family
Segment breakdown not available for this company.
Geographic Mix
Latest annual revenue by reported region
UNITED STATES
55.6%
+1.1% YoY
Tap, hover, or focus a slice to inspect segment detail.
UNITED STATES is the largest reported region at 55.6%, up 1.1% YoY.
PEP Valuation Snapshot
Current multiples compared to the S&P 500, the company's sector, and its own five-year average.
Relative Value Signal
Overvalued
Fair value est. $125 — implies -20.3% from today's price.
Premium to Fair Value
20.3%
above fair value
Deep DiscountFair ValueVery Expensive
vs S&P 500 Trailing P/E
PEP
25.8x
vs
S&P 500
25.1x
In line with benchmark
vs Consumer Defensive Trailing P/E
PEP
25.8x
vs
Consumer Defensive
19.1x
+36% premium
vs PEP 5Y Avg P/E
Today
25.8x
vs
5Y Average
26.3x
In line with benchmark
Forward PE
17.9x
S&P 500
19.1x
-6%
Consumer Defensive
15.0x
+20%
5Y Avg
—
—
Trailing PE
25.8x
S&P 500
25.1x
+3%
Consumer Defensive
19.1x
+36%
5Y Avg
26.3x
-2%
PEG Ratio
7.92x
S&P 500
1.72x
+361%
Consumer Defensive
1.87x
+323%
5Y Avg
—
—
EV/EBITDA
17.7x
S&P 500
15.2x
+16%
Consumer Defensive
11.5x
+54%
5Y Avg
17.5x
+1%
Price/FCF
27.6x
S&P 500
21.1x
+31%
Consumer Defensive
14.9x
+85%
5Y Avg
32.7x
-16%
Price/Sales
2.3x
S&P 500
3.1x
-28%
Consumer Defensive
0.8x
+173%
5Y Avg
2.6x
-12%
Dividend Yield
3.59%
S&P 500
1.87%
+92%
Consumer Defensive
2.79%
+29%
5Y Avg
3.01%
+19%
| Metric | PEP | S&P 500 | Consumer Defensive | 5Y Avg PEP |
|---|---|---|---|---|
| Forward PE | 17.9x | 19.1x | 15.0x+20% | — |
| Trailing PE | 25.8x | 25.1x | 19.1x+36% | 26.3x |
| PEG Ratio | 7.92x | 1.72x+361% | 1.87x+323% | — |
| EV/EBITDA | 17.7x | 15.2x+16% | 11.5x+54% | 17.5x |
| Price/FCF | 27.6x | 21.1x+31% | 14.9x+85% | 32.7x-16% |
| Price/Sales | 2.3x | 3.1x-28% | 0.8x+173% | 2.6x-12% |
| Dividend Yield | 3.59% | 1.87% | 2.79% | 3.01% |
PEP trades above S&P 500 benchmarks on 3 of 6 measured multiples — is elevated on some multiples, but competitive on others — a mixed valuation picture.
Forward P/E and PEG reflect analyst consensus estimates. Historical averages use trailing ratios where forward data is unavailable.S&P 500 and sector benchmarks both use trailing median P/E — similar readings indicate the broader index and sector are priced alike.
Open valuation toolPEP Financial Health
Verdict
Strong
PEP generates $7.7B in free cash flow at a 8.2% margin — 14.9% ROIC signals a durable competitive advantage · returns 4.1% of market cap to shareholders annually.
Cash Engine
Revenue, margins, and cash generation
Revenue (TTM)
Trailing-twelve-month sales base
$93.9B
Revenue Growth
TTM vs prior year
+2.3%
Gross Margin
Gross profit as a share of revenue
54.1%
Operating Margin
Operating income divided by revenue
12.2%
Net Margin
Net income divided by revenue
8.8%
EPS (TTM)
Diluted earnings per share, trailing twelve months
$6.01
Free Cash Flow (TTM)
Cash generation after capex
$7.7B
FCF Margin
FCF as share of revenue — the primary cash quality signal
8.2%
Capital Quality
ROIC, leverage, and debt serviceability
ROIC
Return on invested capital — primary competitive quality signal
14.9%
ROA
Return on assets, trailing twelve months
7.7%
Cash & Equivalents
Liquid assets on the balance sheet
$9.2B
Net Debt
Total debt minus cash
$40.7B
Debt Serviceability
Net debt as a multiple of annual free cash flow
5.3× FCF
~5.3 years to full repayment at current FCF run-rate
ROE *
Return on equity, trailing twelve months
40.1%
* Elevated by buyback-compressed equity — compare ROIC (14.9%) for an undistorted picture of capital efficiency.
Shareholder Returns
How capital is returned to owners
Total shareholder yield
4.1%
Dividend
3.6%
Buyback
0.5%
Share Repurchases
Trailing buyback outflow — dollar magnitude of capital returned
$1.0B
Dividend / Share
Annualized trailing dividend per share
$5.57
Payout Ratio
Share of earnings distributed as dividends
92.7%
Shares Outstanding
Declining as buybacks retire shares
1.4B
All figures from the trailing twelve months. ROIC uses invested capital (equity + net debt). ROE marked * where buyback-compressed equity base may inflate the figure.
Open full ratios pagePEP Stock Risk Factors
Key factors that could pressure the stock price, compress the multiple, or weigh on future results.
AI analysis · updated April 11, 2026
High Risk
Packaging & Regulatory Costs
Increasing regulation on packaging waste, including bans on certain plastics and new taxes, could raise production costs and reduce demand for affected products. Antitrust litigation and potential collusive pricing breakdowns also pose legal exposure.
High Risk
Supply Chain & Production Disruptions
Reliance on a limited number of suppliers and sourcing raw materials from politically unstable regions exposes PepsiCo to manufacturing interruptions. Climate change and water scarcity threaten water availability essential for production, while inadequate preventive maintenance can lead to machinery failures.
Medium
Geopolitical & Economic Volatility
Political instability in key markets, rising commodity, packaging, and transportation costs, and tariff changes can erode margins and demand. Middle East tensions and broader economic challenges add uncertainty to global operations.
Medium
Corporate Governance & Fraud Risk
Inadequate monitoring systems could lead to financial misstatements or fraudulent activities, impacting investor confidence and regulatory scrutiny. Poor financial management may also affect capital allocation and liquidity.
Medium
Market Share & Consumer Preference Shifts
Erosion of market share, brand decay, and loss of pricing power in snack segments threaten revenue. Emerging GLP‑1 weight‑loss drugs may reduce calorie consumption, challenging PepsiCo’s single‑serve product strategy.
Lower
Technology & Innovation Reliability
System outages, IT implementation inefficiencies, or failure to realize expected benefits from technology initiatives could impair operational efficiency and cost control.
These are risk mechanisms, not predictions. The key question is which would force a cut to earnings estimates or a lower multiple than the market currently prices in.
Why PEP Stock Could Outperform
Structural drivers behind the upside case and why the stock could outperform over the next 12 months.
AI analysis · updated April 11, 2026
Robust Brand Portfolio Drives Revenue
PepsiCo’s core brands—Pepsi, Gatorade, and Tropicana—provide stable revenue streams. Convenience foods alone accounted for approximately 58% of total revenue in 2025.
Strategic Business Transformation Fuels Growth
The company is executing SKU rationalization, strategic price cuts, and supply‑chain optimization. These initiatives are expected to recover volume and expand long‑term operating margins.
Strong Financials and Shareholder Returns
PepsiCo has raised its dividend for 53 consecutive years and has a $10 billion share‑buyback authorization, underscoring its commitment to returning value to shareholders.
Projected Margin Expansion in 2026
Preliminary guidance for 2026 indicates substantial operating‑margin expansion, driven by digitalization across the supply chain and marketing to improve efficiency.
Geographic and Product Diversification
The firm is expanding into emerging markets such as Vietnam, India, and Africa, and diversifying into products like Siete Foods, broadening its geographic and category footprint.
A real bull case compounds — each driver matters most when it strengthens margins, supports capital returns, and keeps the company above the market's minimum growth bar simultaneously.
PEP Stock Price Performance
52-week range context and price returns across multiple time horizons. Dividend contribution is shown separately in the Capital Return section.
Current Price
$155.04
52W Range Position
63%
52-Week Range
Current price plotted between the 52-week low and high.
52-Week Low
$127.60
+21.5% from the low
52-Week High
$171.48
-9.6% from the high
1 Month
-1.08%
3 Month
-7.46%
YTD
+9.0%
1 Year
+17.5%
3Y CAGR
-7.2%
5Y CAGR
+1.5%
10Y CAGR
+4.1%
Range context matters because valuation compression and earnings misses rarely hit from the same starting point. A stock already far below its high can still fall, but it is no longer carrying the same embedded optimism as one pressing a fresh peak.
PEP vs Peers
Valuation, growth, and margin comparison against the closest publicly traded peers for this company.
Peer Set
Accurate peer set
Forward PE
17.9x
vs 10.1x median
+77% above peer median
Revenue Growth
+4.1%
vs +2.0% median
+105% above peer median
Net Margin
8.8%
vs 6.6% median
+32% above peer median
| Company | Mkt Cap | Fwd PE | Rev Grw | Margin | Rating | Upside |
|---|---|---|---|---|---|---|
PEP PEP PepsiCo, Inc. | $211.9B | 17.9x | +4.1% | 8.8% | Hold | +12.2% |
KO KO The Coca-Cola Company | $337.8B | 24.1x | +2.0% | 27.8% | Buy | +9.2% |
MDL MDLZ Mondelez International, Inc. | $78.8B | 20.1x | +4.4% | 6.6% | Buy | +9.2% |
GIS GIS General Mills, Inc. | $18.4B | 10.1x | -0.1% | 12.1% | Hold | +34.8% |
CPB CPB Campbell Soup Company | $6.2B | 9.6x | +2.7% | 5.5% | Hold | +23.5% |
CAG CAG Conagra Brands, Inc. | $6.7B | 8.2x | +0.7% | 0.1% | Hold | +25.4% |
This peer comparison reflects companies with similar business models, product lines, or market positioning, supplemented by industry grouping when direct matches are limited.
PEP Dividend and Capital Return
PEP returns 4.1% total yield, led by a 3.59% dividend, raised 27 consecutive years.
Dividend At RiskFCF Stretched
Total Shareholder Yield
4.1%
Dividend + buyback return per year
Buyback Yield
0.5%
Dividend Yield
3.59%
Payout Ratio
92.7%
How PEP Splits Its Return
Div 3.59%
Dividend 3.59%Buybacks 0.5%
Dividend Profile
Yield, cadence, and growth quality
Dividend / Share
Trailing annualized cash dividend
$5.57
Growth Streak
Consecutive years of dividend increases
27Y
3Y Div CAGR
7.5%
5Y Div CAGR
6.9%
Ex-Dividend Date
—
Payment Cadence
Quarterly
4 payments over the last 12 months
Buyback Engine
How much per-share support comes from repurchases
Repurchases (TTM)
Cash used for buybacks in the latest trailing period
$1.0B
Estimated Shares Retired
6M
Approx. Share Reduction
0.5%
Shares Outstanding
Current diluted share count from the screening snapshot
1.4B
| Year | Div / Share | YoY Grw | BB Yield | Total Yield |
|---|---|---|---|---|
| 2026 | $1.42 | — | — | — |
| 2025 | $5.62 | +5.5% | 0.5% | 4.4% |
| 2024 | $5.33 | +7.8% | 0.5% | 3.9% |
| 2023 | $4.94 | +9.3% | 0.4% | 3.3% |
| 2022 | $4.52 | +6.5% | 0.6% | 3.1% |
FAQ
7 questionsPEP Investor Questions
Common questions answered from live analyst data and company financials.
01Is PepsiCo, Inc. (PEP) stock a buy or sell in 2026?
PepsiCo, Inc. (PEP) is rated Hold by Wall Street analysts as of 2026. Of 45 analysts covering the stock, 16 rate it Buy or Strong Buy, 28 rate it Hold, and 1 rate it Sell or Strong Sell. The consensus 12-month price target is $174, implying +12.2% from the current price of $155. The bear case scenario is $142 and the bull case is $256.
02What is the PEP stock price target for 2026?
The Wall Street consensus price target for PEP is $174 based on 45 analyst estimates. The high-end target is $191 (+23.2% from today), and the low-end target is $158 (+1.9%). The base case model target is $194.
03Is PepsiCo, Inc. (PEP) stock overvalued in 2026?
PEP trades at 17.9x times forward earnings. The stock's valuation is broadly in line with the broader market. Based on current multiples versus the peer group, the relative model signals overvalued. Whether the stock is over or undervalued ultimately depends on whether consensus earnings estimates are achievable.
04What are the main risks for PepsiCo, Inc. (PEP) stock in 2026?
The primary risks for PEP in 2026 are: (1) Packaging & Regulatory Costs — Increasing regulation on packaging waste, including bans on certain plastics and new taxes, could raise production costs and reduce demand for affected products. (2) Supply Chain & Production Disruptions — Reliance on a limited number of suppliers and sourcing raw materials from politically unstable regions exposes PepsiCo to manufacturing interruptions. (3) Geopolitical & Economic Volatility — Political instability in key markets, rising commodity, packaging, and transportation costs, and tariff changes can erode margins and demand. Each factor has the potential to pressure earnings or compress the stock's valuation multiple.
05What is PepsiCo, Inc.'s revenue and earnings forecast?
Analyst consensus estimates PEP will report consensus revenue of $97.7B (+4.1% year-over-year) and EPS of $7.30 (+21.4% year-over-year) for the upcoming fiscal year. The following year, analysts project $100.6B in revenue.
06When does PepsiCo, Inc. (PEP) report its next earnings?
A confirmed upcoming earnings date for PEP is not yet available. Check the Earnings section above for the most recent quarterly report dates and forward estimates.
07How much free cash flow does PepsiCo, Inc. generate?
PepsiCo, Inc. (PEP) generated $7.7B in free cash flow over the trailing twelve months — a free cash flow margin of 8.2%. PEP returns capital to shareholders through dividends (3.6% yield) and share repurchases ($1.0B TTM).