PepsiCo Inc. (NASDAQ:PEP)

The liquidity position, as indicated by the observed ratios, exhibits a generally stable pattern over the analyzed period, with some fluctuations. The current, quick, and cash ratios demonstrate cyclical behavior, though remaining within a relatively narrow range. Overall, the company maintains a conservative liquidity profile.

Current Ratio

The current ratio fluctuated between 0.80 and 0.92 throughout the period. A slight downward trend was observed from March 2022 to December 2022, followed by stabilization and a minor increase in the subsequent quarters. The most recent values, from March 2025 to December 2025, show a slight increase, peaking at 0.91 before settling at 0.90. This suggests a consistent ability to cover short-term liabilities with short-term assets, though consistently below 1.0.

Quick Ratio

The quick ratio, a more conservative measure of liquidity, followed a similar pattern to the current ratio, ranging from 0.56 to 0.68. A low point was observed in December 2022 at 0.58, with a subsequent recovery. The ratio experienced a dip to 0.56 in June 2025, followed by a rebound to 0.67 and 0.68 in the final two quarters. This indicates a consistent, though limited, ability to meet short-term obligations with the most liquid assets.

Cash Ratio

The cash ratio, representing the company’s ability to cover immediate liabilities with cash and cash equivalents, remained the most stable of the three ratios. It ranged from 0.20 to 0.32. A gradual increase was observed from March 2022 through September 2023, peaking at 0.32. The ratio then experienced a slight decline to 0.27, followed by a recovery to 0.31 in the most recent quarter. This suggests a consistent, albeit conservative, cash position.

In summary, the observed liquidity ratios suggest a consistent, though relatively conservative, financial position. While fluctuations exist, the ratios remain within a defined range, indicating a predictable pattern in the company’s ability to meet its short-term obligations. The consistent values below 1.0 for the current and quick ratios suggest a reliance on inventory and accounts receivable to meet short-term liabilities.

The current ratio exhibits a generally stable, yet fluctuating pattern over the observed period. Throughout the analyzed timeframe, the ratio consistently remains below 1, indicating that current liabilities have generally exceeded current assets. However, the ratio does not demonstrate a significant or sustained directional trend.

Overall Trend

The current ratio fluctuates between approximately 0.78 and 0.92. There is no clear upward or downward trend over the entire period. The ratio demonstrates cyclical behavior, with periods of slight improvement followed by periods of decline.

Short-Term Fluctuations (2022-2023)

From March 2022 to December 2022, the current ratio decreased from 0.87 to 0.80. A slight recovery was observed in the first half of 2023, peaking at 0.84 in June 2023, before declining to 0.78 by December 2023. This suggests potential short-term liquidity pressures during the latter part of 2022 and early 2023.

Mid-Term Stability (2023-2025)

The period from 2023 through 2025 shows a relatively stable range, with the ratio oscillating between 0.78 and 0.91. While fluctuations occur, they remain within a narrow band, suggesting a consistent, albeit constrained, liquidity position.

Recent Period (2025-2026)

The current ratio increased from 0.91 in September 2025 to 0.90 in March 2026. This slight improvement could indicate a strengthening of the short-term liquidity position, although the change is marginal.

Notable Observations

The lowest point in the observed period was 0.78 in December 2023. The highest point was 0.92 in September 2022. The ratio consistently remaining below 1 suggests the entity relies on factors beyond immediately liquid assets to meet its short-term obligations.

In conclusion, the current ratio indicates a consistent, but limited, ability to cover short-term liabilities with current assets. The observed fluctuations suggest the entity’s liquidity position is sensitive to changes in current asset and liability levels, but does not demonstrate a clear, long-term trend of improvement or deterioration.

The quick ratio for the analyzed period demonstrates fluctuations, generally remaining within a relatively narrow range. An initial decline is observed from March 2022 to June 2022, followed by a period of improvement and subsequent stabilization before another decline towards the end of the analyzed timeframe.

Overall Trend

The quick ratio began at 0.63 in March 2022, decreased to 0.59 in June 2022, and then increased to a peak of 0.68 in September 2022. It subsequently decreased to 0.58 by December 2022. The ratio experienced further fluctuations throughout 2023, oscillating between 0.60 and 0.68. A slight downward trend is then visible in 2024, reaching 0.60 in June 2024, before stabilizing around 0.62-0.68 through September 2025. The ratio concludes the period at 0.67 in March 2026.

Short-Term Fluctuations

A notable increase in the quick ratio occurred between June 2022 and September 2022, suggesting an improvement in the ability to meet short-term obligations with the most liquid assets. Conversely, the decline from September 2022 to December 2022 indicates a potential weakening in this ability. Similar, albeit less pronounced, fluctuations are observed throughout 2023 and 2024.

Recent Performance

The most recent quarters show a relative stabilization of the quick ratio, hovering around 0.67-0.68. This suggests a consistent, though not dramatically improved, capacity to cover immediate liabilities with readily available assets. The slight increase from 0.64 in December 2023 to 0.67 in March 2026 indicates a modest strengthening of the short-term liquidity position.

The quick ratio consistently remains below 1.0 throughout the entire period, indicating that the entity does not consistently hold enough liquid assets to cover its immediate liabilities. However, the ratio generally remains above 0.5, suggesting a reasonable, though not robust, short-term liquidity position.

The cash ratio, representing the ability to meet current liabilities with only cash and cash equivalents, exhibits fluctuations over the observed period. Generally, the ratio remains within a relatively narrow band, suggesting a consistent, though not exceptionally strong, short-term liquidity position.

Overall Trend

From March 2022 through December 2023, the cash ratio generally ranged between 0.20 and 0.32. A slight increasing trend is noticeable in the latter half of 2023, peaking at 0.32 in December 2023. This trend reverses in the first half of 2024, declining to 0.21 in June 2024 before stabilizing and showing a modest increase through December 2025.

Short-Term Fluctuations

The ratio experienced a decrease from 0.27 in March 2022 to 0.21 in June 2022. A subsequent recovery to 0.26 was observed by September 2022, followed by another decline to 0.20 by the end of the year. Similar short-term volatility is present throughout the period, indicating sensitivity to changes in both cash assets and current liabilities.

Recent Performance (2024-2025)

The period from March 2024 to December 2025 shows a more stable pattern. The ratio fluctuates between 0.27 and 0.31, with a slight upward movement towards the end of the observation window. The cash ratio reached 0.31 in March 2026, indicating a potentially improved liquidity position compared to earlier periods.

Relationship to Underlying Components

The cash ratio’s movements correlate with changes in both total cash assets and current liabilities. Increases in the ratio typically coincide with increases in cash assets relative to current liabilities, and vice versa. The most significant increase in the ratio, observed between September 2023 and December 2023, corresponds with a substantial rise in total cash assets from US$10,283 million to US$10,003 million, while current liabilities remained relatively stable.

In conclusion, the cash ratio demonstrates a generally stable liquidity position with periodic fluctuations. The recent trend suggests a slight improvement in the company’s ability to cover its current liabilities with readily available cash.