PEP PE Ratio & Valuation,Is PEP Overvalued

PEP Relative Valuation

PEP's fair value is calculated using relative valuation, based on historical P/E and P/S ranges and their premiums/discounts relative to a competitor average, adjusted by weights. If the market price exceeds this fair value range, PEP is overvalued; if below, it's undervalued.

Historical Valuation

PepsiCo Inc (PEP) is now in the Undervalued zone, suggesting that its current forward PE ratio of 16.75 is considered Undervalued compared with the five-year average of 21.82. The fair price of PepsiCo Inc (PEP) is between 160.61 to 200.18 according to relative valuation methord. Compared to the current price of 139.37 USD , PepsiCo Inc is Undervalued By 13.22%.

Relative Value

Fair Zone

160.61-200.18

Current Price：139.37

13.22%

Undervalued

16.75

12.57

EV/EBITDA

PepsiCo Inc. (PEP) has a current EV/EBITDA of 12.57. The 5-year average EV/EBITDA is 15.57. The thresholds are as follows: Strongly Undervalued below 12.04, Undervalued between 12.04 and 13.81, Fairly Valued between 17.34 and 13.81, Overvalued between 17.34 and 19.11, and Strongly Overvalued above 19.11. The current Forward EV/EBITDA of 12.57 falls within the Undervalued range.

15.30

EV/EBIT

PepsiCo Inc. (PEP) has a current EV/EBIT of 15.30. The 5-year average EV/EBIT is 19.23. The thresholds are as follows: Strongly Undervalued below 14.63, Undervalued between 14.63 and 16.93, Fairly Valued between 21.53 and 16.93, Overvalued between 21.53 and 23.83, and Strongly Overvalued above 23.83. The current Forward EV/EBIT of 15.30 falls within the Undervalued range.

2.05

PepsiCo Inc. (PEP) has a current PS of 2.05. The 5-year average PS is 2.53. The thresholds are as follows: Strongly Undervalued below 2.00, Undervalued between 2.00 and 2.27, Fairly Valued between 2.80 and 2.27, Overvalued between 2.80 and 3.07, and Strongly Overvalued above 3.07. The current Forward PS of 2.05 falls within the Undervalued range.

13.14

P/OCF

PepsiCo Inc. (PEP) has a current P/OCF of 13.14. The 5-year average P/OCF is 16.47. The thresholds are as follows: Strongly Undervalued below 12.50, Undervalued between 12.50 and 14.49, Fairly Valued between 18.45 and 14.49, Overvalued between 18.45 and 20.44, and Strongly Overvalued above 20.44. The current Forward P/OCF of 13.14 falls within the Undervalued range.

18.76

P/FCF

PepsiCo Inc. (PEP) has a current P/FCF of 18.76. The 5-year average P/FCF is 26.96. The thresholds are as follows: Strongly Undervalued below 14.46, Undervalued between 14.46 and 20.71, Fairly Valued between 33.20 and 20.71, Overvalued between 33.20 and 39.45, and Strongly Overvalued above 39.45. The current Forward P/FCF of 18.76 falls within the Undervalued range.

PepsiCo Inc (PEP) has a current Price-to-Book (P/B) ratio of 10.04. Compared to its 3-year average P/B ratio of 12.16 , the current P/B ratio is approximately -17.41% higher. Relative to its 5-year average P/B ratio of 12.75, the current P/B ratio is about -21.20% higher. PepsiCo Inc (PEP) has a Forward Free Cash Flow (FCF) yield of approximately 3.45%. Compared to its 3-year average FCF yield of 3.01%, the current FCF yield is approximately 14.51% lower. Relative to its 5-year average FCF yield of 3.02% , the current FCF yield is about 14.35% lower.

10.04

P/B

Median3y

12.16

Median5y

12.75

3.45

FCF Yield

Median3y

3.01

Median5y

3.02

Competitors Valuation Multiple

The average P/S ratio for PEP's competitors is 2.03, providing a benchmark for relative valuation. PepsiCo Inc Corp (PEP) exhibits a P/S ratio of 2.05, which is 1.03% above the industry average. Given its robust revenue growth of 2.65%, this premium appears unsustainable.

P/S

P/E

EV/EBITDA

EV/EBIT

Revenue Growth

Market Cap

Performance Decomposition

Market capitalization of PEP decreased by 9.08% over the past 1 year. The primary factor behind the change was an increase in Revenue Growth from 23.32B to 23.94B.

The secondary factor is the P/E Change, contributed 1.65%to the performance.

Overall, the performance of PEP in the past 1 year is driven by Revenue Growth. Which is more sustainable.

2.65%

23.32B → 23.94B

Revenue Growth

-13.38%

12.63 → 10.94

Margin Expansion

1.65%

26.61 → 27.05

P/E Change

-9.08%

150.69 → 137.01

Mkt Cap Growth

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Frequently Asked Questions

Is PepsiCo Inc (PEP) currently overvalued or undervalued?

What is PepsiCo Inc (PEP) fair value?

PEP's fair value is calculated using relative valuation, based on historical P/E and P/S ranges and their premiums/discounts relative to a competitor average , adjusted by weights. The fair price of PepsiCo Inc (PEP) is between 160.61 to 200.18 according to relative valuation methord.

How does PEP's valuation metrics compare to the industry average?

What is the current P/B ratio for PepsiCo Inc (PEP) as of Jan 08 2026?

As of Jan 08 2026, PepsiCo Inc (PEP) has a P/B ratio of 10.04. This indicates that the market values PEP at 10.04 times its book value.

What is the current FCF Yield for PepsiCo Inc (PEP) as of Jan 08 2026?

As of Jan 08 2026, PepsiCo Inc (PEP) has a FCF Yield of 3.45%. This means that for every dollar of PepsiCo Inc’s market capitalization, the company generates 3.45 cents in free cash flow.

What is the current Forward P/E ratio for PepsiCo Inc (PEP) as of Jan 08 2026?

As of Jan 08 2026, PepsiCo Inc (PEP) has a Forward P/E ratio of 16.75. This means the market is willing to pay $16.75 for every dollar of PepsiCo Inc’s expected earnings over the next 12 months.

What is the current Forward P/S ratio for PepsiCo Inc (PEP) as of Jan 08 2026?

As of Jan 08 2026, PepsiCo Inc (PEP) has a Forward P/S ratio of 2.05. This means the market is valuing PEP at $2.05 for every dollar of expected revenue over the next 12 months.

PEP Valuation