What is PepsiCo Financial Strength?
PepsiCo has the Financial Strength Rank of 6.
GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:
1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.
PepsiCo's Interest Coverage for the quarter that ended in Mar. 2024 was 13.45.PepsiCo's debt to revenue ratio for the quarter that ended in Mar. 2024 was 0.63.As of today, PepsiCo's Altman Z-Score is 4.02.
Competitive Comparison of PepsiCo's Financial Strength
For the Beverages - Non-Alcoholic subindustry, PepsiCo's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
PepsiCo's Financial Strength Distribution in the Beverages - Non-Alcoholic Industry
For the Beverages - Non-Alcoholic industry and Consumer Defensive sector, PepsiCo's Financial Strength distribution charts can be found below:
* The bar in red indicates where PepsiCo's Financial Strength falls into.
PepsiCo Financial Strength Calculation
GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors
A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.
1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.
Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:
PepsiCo's Interest Expense for the months ended in Mar. 2024 was $-202 Mil. Its Operating Income for the months ended in Mar. 2024 was $2,717 Mil. And its for the quarter that ended in Mar. 2024 was $37,707 Mil.
PepsiCo's Interest Coverage for the quarter that ended in Mar. 2024 is
Interest Coverage | = | -1 | * | Operating Income (Q: Mar. 2024 ) | / | Interest Expense (Q: Mar. 2024 ) |
= | -1 | * | 2717 | / | -202 | |
= | 13.45 |
The higher the ratio, the stronger the company's financial strength is.
2. Debt to revenue ratio. The lower, the better.
PepsiCo's Debt to Revenue Ratio for the quarter that ended in Mar. 2024 is
Debt to Revenue Ratio | = | Total Debt (Q: Mar. 2024 ) | / | Revenue | ||
= | ( | + | ) | / | Revenue | |
= | (8161 | + | 37707) | / | 73000 | |
= | 0.63 |
3. Altman Z-Score.
Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.
The zones of discrimination were as such:
When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.
PepsiCo has a Z-score of 4.02, indicating it is in Safe Zones. This implies the Z-Score is strong.
Good Sign:
Altman Z-score of 4.02 is strong.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
PepsiCo(NAS:PEP) Financial Strength Explanation
The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.
PepsiCo has the Financial Strength Rank of 6.
PepsiCo Financial Strength Related Terms
Thank you for viewing the detailed overview of PepsiCo's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.
PepsiCo (PepsiCo) Business Description
Industry
GURUFOCUS.COM »STOCK LIST »Consumer Defensive » Beverages - Non-Alcoholic » PepsiCo Inc (NAS:PEP) » Definitions » Financial Strength
Comparable Companies
KO MNST KDP CELH COCSF co*kE FIZZ COCO SHOT ZVIA HKSE:09633 LSE:CCEP NSE:VBL AC LSE:CCH IST:CCOLA TSE:2267 SHSE:603156 HKSE:00220 TSX:PRMW
Traded in Other Exchanges
PEP:Mexico 1PEP:Italy PEPd:UK 0QOS:UK PEP:Germany PEP:Germany PEP:Germany PEP:Germany PEP:Switzerland PEPB34:Brazil PEPS:Austria PEP:Argentina
Address
700 Anderson Hill Road, Purchase, NY, USA, 10577
Website
PepsiCo is a global leader in snacks and beverages, owning well-known household brands including Pepsi, Mountain Dew, Gatorade, Lay's, Cheetos, and Doritos, among others. The company dominates the global savory snacks market and also ranks as the second-largest beverage provider in the world (behind Coca-Cola) with diversified exposure to carbonated soft drinks, or CSD, as well as water, sports, and energy offerings. Convenience foods account for approximately 55% of its total revenue, with beverages making up the rest. Pepsi owns the bulk of its manufacturing and distribution capacity in the United States and overseas. International markets make up 40% of total sales and one third of operating profits.
Executives
Hugh F Johnston | officer: EVP, Operations | PEPSICO, INC., 700 ANDERSON HILL ROAD, PURCHASE NY 10577 |
Becky Schmitt | officer: EVP & Chief HR Officer | 300 FRANK W. BURR BLVD., STE. 36, 6 FL., TEANECK NJ 07666 |
Jennifer Bailey | director | 700 ANDERSON HILL ROAD, PURCHASE NY 10577 |
Susan M Diamond | director | 500 W MAIN ST., LOUISVILLE KY 40202 |
Robert C Pohlad | director | 4000 DAIN RAUSCHER PLAZA, 60 SOUTH SIXTH STREET, MINNEAPOLIS MN 55402 |
Ramkumar Krishnan | officer: CEO Intl Beverages & CCO | TRACTOR SUPPLY, 5401 VIRGINIA WAY, BRENTWOOD TN 37027 |
Marie T. Gallagher | officer: SVP and Controller | PEPSICO, INC., 700 ANDERSON HILL ROAD, PURCHASE NY 10577 |
Paula Santilli | officer: CEO, Latin America | PEPSICO, INC., 700 ANDERSON HILL ROAD, PURCHASE NY 10577 |
Ramon Laguarta | officer: CEO, PepsiCo Europe | PEPSICO, INC., 700 ANDERSON HILL ROAD, PURCHASE NY 10577 |
Steven C Williams | officer: CEO, PFNA | PEPSICO, INC., 700 ANDERSON HILL ROAD, PURCHASE NY 10577 |
Kirk Tanner | officer: President & COO, NAB | PEPSICO, INC. 700 ANDERSON HILL ROAD, PURCHASE NY 10577 |
David Flavell | officer: EVP, Gen Counsel & Corp Sec | PEPSICO, INC., 700 ANDERSON HILL ROAD, PURCHASE NY 10577 |
Eugene Willemsen | officer: CEO, AMESA | PEPSICO, INC., 700 ANDERSON HILL ROAD, PURCHASE NY 10577 |
Edith W Cooper | director | C/O ETSY, INC., 117 ADAMS STREET, BROOKLYN NY 11249 |
Dave J Lewis | director | PEPSICO, INC., 700 ANDERSON HILL ROAD, PURCHASE NY 10577 |
PepsiCo (PepsiCo) Headlines
From GuruFocus
Q1 2020 PepsiCo Inc Earnings Call Transcript
By GuruFocus Research • 01-23-2024
Q1 2022 PepsiCo Inc Earnings Call Transcript
By GuruFocus Research • 01-23-2024
By GuruFocus Research • 01-23-2024
Beyond Market Price: Uncovering PepsiCo Inc's Intrinsic Value
By GuruFocus Research • 01-23-2024
Taste the Celebration: Frito-Lay Offers One Fan the Chance to Launch the Confetti for the Winning Team at Super Bowl LVIII
By PRNewswire • 01-23-2024
Q3 2022 PepsiCo Inc Earnings Call Transcript
By GuruFocus Research • 01-23-2024
Celsius Holdings Inc and PepsiCo Inc to Announce Long-Term Distribution Agreement and Investment Transcript
By GuruFocus Research • 01-23-2024
PepsiCo Inc at Consumer Analyst Group of New York (CAGNY) Virtual Conference Transcript
By GuruFocus Research • 01-23-2024
Q4 2022 PepsiCo Inc Earnings Call Transcript
By GuruFocus Research • 01-23-2024
Q3 2021 PepsiCo Inc Earnings Call Transcript
By GuruFocus Research • 01-23-2024