-1.68 | -2.03%
PEPSICO INC's gross profit margin for the first quarter of its fiscal year 2013 is essentially unchanged when compared to the same period a year ago. Even though sales increased, the net income has decreased. PEPSICO INC has weak liquidity. Currently, the Quick Ratio is 0.79 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.
During the same period, stockholders' equity ("net worth") has remained virtually unchanged only decreasing by 1.28% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.
| Income Statement | Q1 FY13 | Q1 FY12 |
|---|---|---|
| Net Sales ($mil) | 12581.0 | 12428.0 |
| EBITDA ($mil) | 2332.0 | 2312.0 |
| EBIT ($mil) | 1781.0 | 1757.0 |
| Net Income ($mil) | 1075.0 | 1127.0 |
| Balance Sheet | Q1 FY13 | Q1 FY12 |
|---|---|---|
| Cash & Equiv. ($mil) | 7011.0 | 3813.0 |
| Total Assets ($mil) | 75355.0 | 74391.0 |
| Total Debt ($mil) | 29400.0 | 27710.0 |
| Equity ($mil) | 22351.0 | 22641.0 |
| Profitability | Q1 FY13 | Q1 FY12 |
|---|---|---|
| Gross Profit Margin | 57.83 | 56.88 |
| EBITDA Margin | 18.53 | 18.6 |
| Operating Margin | 14.16 | 14.14 |
| Sales Turnover | 0.87 | 0.9 |
| Return on Assets | 8.12 | 8.63 |
| Return on Equity | 27.4 | 28.38 |
| Debt | Q1 FY13 | Q1 FY12 |
|---|---|---|
| Current Ratio | 1.11 | 1.03 |
| Debt/Capital | 0.57 | 0.55 |
| Interest Expense | 214.0 | 198.0 |
| Interest Coverage | 8.32 | 8.87 |
| Share Data | Q1 FY13 | Q1 FY12 |
|---|---|---|
| Shares outstanding (mil) | 1545.0 | 1567.0 |
| Div / share | 0.54 | 0.52 |
| EPS | 0.69 | 0.71 |
| Book value / share | 14.47 | 14.45 |
| Institutional Own % | n/a | n/a |
| Avg Daily Volume | 5230272.0 | 5723178.0 |
BUY. The current P/E ratio indicates a discount compared to an average of 24.61 for the Beverages industry and a premium compared to the S&P 500 average of 18.91. For additional comparison, its price-to-book ratio of 5.67 indicates a significant premium versus the S&P 500 average of 2.42 and a discount versus the industry average of 6.23. The price-to-sales ratio is above the S&P 500 average, but well below the industry average. Upon assessment of these and other key valuation criteria, PEPSICO INC proves to trade at a discount to investment alternatives within the industry.
| Price/Earnings |
|
Price/Cash Flow |
| |||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| PEP 21.02 | Peers 24.61 | PEP 12.84 | Peers 105.66 | |||||||||||||||||||||
|
Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations. PEP is trading at a discount to its peers. |
Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures. PEP is trading at a significant discount to its peers. |
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| Price/Projected Earnings |
|
Price to Earnings/Growth |
|
|||||||||||||||||||||
| PEP 17.19 | Peers 19.68 | PEP 1.72 | Peers 3.19 | |||||||||||||||||||||
|
Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations. PEP is trading at a valuation on par with its peers. |
Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples. PEP trades at a significant discount to its peers. |
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| Price/Book |
|
Earnings Growth |
|
|||||||||||||||||||||
| PEP 5.67 | Peers 6.23 | PEP -2.99 | Peers 0.83 | |||||||||||||||||||||
|
Average. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet. PEP is trading at a valuation on par with its peers. |
Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios. However, PEP is expected to significantly trail its peers on the basis of its earnings growth rate. |
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| Price/Sales |
|
Sales Growth |
|
|||||||||||||||||||||
| PEP 1.93 | Peers 5.24 | PEP -2.02 | Peers -3.61 | |||||||||||||||||||||
|
Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales. PEP is trading at a significant discount to its industry on this measurement. |
Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share. PEP has a sales growth rate that significantly exceeds its peers. |
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