Is the business good?
How good a business is PEP?
PepsiCo earns 15% on the capital it employs against a 9.0% cost of capital, so the business is worth more the bigger it gets.
15%
Return on invested capital · cost of capital 9.0% · 6.0 points above what the capital costs: growth creates value
- Operating margin
- 14%
Operating margin · Beverages - Non-Alcoholic median 16% · 12 months to Q2 2026
- Cash conversion
- 0.61×
Cash conversion · 0.18× a year ago · some of the reported profit has not turned into cash yet
- Share count, year on year
- −0.51%
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 Q2 2026
- 54%
- Operating margin12 months to Q2 2026
- 14%
- Net margin12 months to Q2 2026
- 10%
- Free cash flow margin
- 6.3%
- Revenue, trailing twelve months
- $90.3B
- Free cash flow, trailing twelve months
- $5.64B
- Net income, trailing twelve months
- $9.17B
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 15%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion from the cash flow statement.
Beverages - Non-Alcoholic
Ranks #3 of 10 by Smart Score