Pepsico operates worldwide beverage, snack and food businesses. The company sells its products to authorized bottlers, independent distributors, and retailers. The company was founded in 1898 and is based in Purchase, New York.
PEP Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for PEP, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Pepsico Inc ranked in the 16th percentile in terms of potential gain offered. We should note, though, that the most conservative analysis suggests this stock will yield negative results -- and thus may be a potential short opportunity. The most interesting components of our discounted cash flow analysis for Pepsico Inc ended up being:
Its compound free cash flow growth rate, as measured over the past 5.83 years, is -0.02% -- higher than merely 24.85% of stocks in our DCF forecasting set.
As a business, PEP is generating more cash flow than 87.11% of positive cash flow stocks in the Consumer Defensive.
PEP's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 35.16% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Consumer Defensive that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as PEP, try BF.B, GHC, HRL, AGFS, and BRFS.