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what it is
PepsiCo sells snacks and drinks worldwide and turns them into steady cash.
how it gets paid
Last year Pepsico made $93.9B in revenue. PepsiCo International was the main engine at $37.6B, or 40% of sales.
why it's growing
Revenue grew 2.3% last year. The number that mattered was $2.26 EPS, because it matched the estimate exactly and told you the quarter was stable, not surprising.
what just happened
PepsiCo landed $2.26 EPS, exactly on estimate, so the quarter was solid, not loud.
At a glance
A balance sheet — strong enough to weather a downturn
100/100 earnings predictability — you can trust these numbers
17.7x trailing p/e — the market's not buying it — or you found a deal
4.2% dividend yield — cash in your pocket every quarter
28.0% return on capital — every dollar works hard here
xvary composite: 78/100 — average
What they do
PepsiCo sells snacks and drinks worldwide and turns them into steady cash.
Frito-Lay made 43% of operating profit on 27% of sales in 2024. Operating profit → profit after running the business → that gap is why Pepsi prints cash. You are buying snacks and drinks, but the money comes from the pantry, the cooler, and the vending machine.
How they make money
$93.9B
annual revenue · their business grew +2.3% last year
Frito-Lay North America
$25.4B
PepsiCo Beverages North America
$28.2B
Quaker Foods North America
$2.8B
PepsiCo International
$37.6B
The products that matter
salty snacks manufacturing and sales
Frito-Lay North America
$25.4B · 27% of sales
it is a $25.4B business and 27% of company sales. this is the snack shelf you are really buying.
27% of sales
beverage manufacturing and sales
PepsiCo Beverages North America
$28.2B · 30% of sales
this is the largest disclosed segment at $28.2B, or 30% of revenue. if beverages stumble, you will feel it.
largest segment
packaged foods portfolio
Quaker Foods
inside the remaining $40.3B
quaker sits inside the remaining $40.3B outside the two biggest north american segments. the snapshot does not break it out further, which tells you it is not the main valuation driver here.
not the center
Key numbers
4.2%
dividend yield
This is the cash you collect each year. It is almost double the 2.3% revenue growth rate.
28.0%
return on capital
Return on capital → profit per dollar invested → 28.0% says Pepsi still squeezes hard profits out of its asset base.
12.2%
operating margin
Operating margin → profit after running the business → 12.2% means $12.20 of every $100 in sales stays before taxes.
$165
18-mo target
That target sits 14% above $144.24. The street is not calling for heroics, just a slow rerate.
Financial health
A
strength
- balance sheet grade A — very strong financial position
- risk rank 1 — safer than 95% of stocks
- price stability 100 / 100
- long-term debt $44.1B (18% of capital)
- net profit margin 14.4% — keeps 14 cents of every dollar in revenue
- return on equity 64% — $0.64 profit for every $1 investors have put in
A with balance sheet grade and risk rank standing out. your money faces less risk here than at most public companies.
Total return vs. market
You invested $10,000 in PEP 3 years ago → it's now worth $8,750.
The index would have given you $13,920.
source: institutional data · total return
What just happened
beat estimates
PepsiCo landed $2.26 EPS, exactly on estimate, so the quarter was solid, not loud.
Consensus showed $2.26 actual vs $2.26 estimate, so there was no surprise in the headline number. EDGAR also lists $64.6B revenue and 54.6% gross margin in the filing set, so the source data are not line-by-line aligned.
$64.6B
revenue
$2.26
eps
54.6%
gross margin
the number that mattered
The number that mattered was $2.26 EPS, because it matched the estimate exactly and told you the quarter was stable, not surprising.
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wall street support for pepsico stock has increased over the past three months.
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there are several reasons that the investment community is likely emboldened.first, the beverage giant probably closed 2025 with a strong financial performance during last year’s final stanza.
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also, an upbeat 2026 outlook adds some appeal.furthermore, the company’s ability to navigate broader market challenges over both the near and long terms is a positive attribute.
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overall, the bellwether holding appears to have more room to run.
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the company has outlined preliminary expectations and initiatives for 2026.sales and earnings are likely to increase at a single-digit clip next year, to $96.0 billion and $8.50 a share, respectively.
source: company earnings report, 2026
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What could go wrong
the #1 risk is pricing meeting a softer consumer.
med
pricing meeting a softer consumer
PEP's two biggest disclosed north american businesses total $53.6B in sales. if shoppers trade down or buy less, that is where you will feel it first.
missing the ~$96B 2026 revenue target would tell you pricing is no longer doing enough of the heavy lifting.
med
input cost inflation
ingredients, packaging, freight, and labor can rise faster than list prices. that is how a 12.0% net margin becomes less comfortable.
a 1-point margin hit on a $93.9B revenue base is roughly $939M of profit pressure.
med
2026 guide proves optimistic
moving from $8.15 to about $8.50 EPS is only about 4% growth, but even modest targets matter when the thesis is reliability.
if earnings stall while the stock still trades near 17x, the case shifts from dependable compounding to dead money with a dividend.
these risks sit against a $53.6B north american core and a 12.0% net margin that does not have endless room to absorb a shock.
source: institutional data · regulatory filings · risk analysis
Pay attention to
target
2026 EPS target: ~$8.50
that is only about 4% above the $8.15 just posted. if pepsico misses even a modest hurdle, the safe-compounder case weakens.
risk
12.0% net margin
pricing power is real until it is not. a margin slip tells you costs or consumer resistance are winning.
next report
volume versus price
the next earnings print matters less for headline EPS than for whether growth still looks healthy on a $93.9B base.
flow
institutional buying staying positive
1,545 buyers versus 1,521 sellers is a small edge, not a stampede. you want that direction to hold.
Analyst rankings
short-term outlook
average
momentum score 3. in human-speak: analysts expect the stock to behave like a staple, not a sprinter.
risk profile
safest 5%
stability score 1. lower risk than roughly 95% of stocks — this is why the 4.2% yield matters.
chart momentum
average
technical score 3. the chart is not broken, but it is not signaling a rush back into the name either.
earnings predictability
100 / 100
management gives reliable guidance, and the business usually lands near it. that is rare.
source: institutional data
Institutional activity
1,545 buyers vs. 1,521 sellers in 3q2025. total institutional holdings: 1.0B shares.
source: institutional data
Price targets
3-5 year target range
$125
$204
$144
current price
$165
target midpoint · +14% from current · 3-5yr high: $275 (+90% · 20% ann'l return)
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