Enterprise Value to EBITDA (EV/EBITDA)
Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
PepsiCo Inc., EBITDA calculation
US$ in millions
Based on: 10-K (reporting date: 2024-12-28), 10-K (reporting date: 2023-12-30), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-25), 10-K (reporting date: 2020-12-26).
The financial data analyzed reveals consistent growth trends across all major profitability metrics over the five-year period under review.
- Net Income Attributable to PepsiCo
-
This metric shows a steady increase each year, reflecting enhanced profitability at the bottom line. Starting from 7,120 million US dollars in 2020, net income rises progressively to reach 9,578 million US dollars by 2024. The growth is gradual but consistent, indicating effective cost management, revenue growth, or a combination of factors contributing to improving net profitability.
- Earnings Before Tax (EBT)
-
EBT demonstrates a similar upward trajectory, increasing from 9,069 million US dollars in 2020 to 11,946 million US dollars in 2024. This steady growth highlights expanding pre-tax earnings which could stem from higher revenues, operational efficiencies, or better control over non-operating expenses. The trend suggests sustained operational strength before tax considerations.
- Earnings Before Interest and Tax (EBIT)
-
EBIT shows a consistent rise from 10,321 million US dollars in 2020 to 13,552 million US dollars in 2024. This indicates ongoing improvements in operating profitability, excluding financing costs and taxes. The year-on-year increases demonstrate efficient core business operations and effective management of operational costs and revenues.
- Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA)
-
EBITDA increases steadily from 12,869 million US dollars in 2020 to 16,712 million US dollars in 2024. This trend signifies strong cash-generating ability from operations before accounting for capital expenditures and financial charges. The upward trend points towards robust business performance and operational scalability.
Overall, the data indicates healthy profitability growth with stable improvements across all key earnings metrics. The consistent increases illustrate a positive financial trajectory, potentially driven by effective operational strategies, cost efficiencies, and revenue growth initiatives.
Enterprise Value to EBITDA Ratio, Current
PepsiCo Inc., current EV/EBITDA calculation, comparison to benchmarks
| Selected Financial Data (US$ in millions) | |
| Enterprise value (EV) | 220,787) |
| Earnings before interest, tax, depreciation and amortization (EBITDA) | 16,712) |
| Valuation Ratio | |
| EV/EBITDA | 13.21 |
| Benchmarks | |
| EV/EBITDA, Competitors1 | |
| Coca-Cola Co. | 21.41 |
| Mondelēz International Inc. | 13.38 |
| Philip Morris International Inc. | 22.87 |
| EV/EBITDA, Sector | |
| Food, Beverage & Tobacco | 18.11 |
| EV/EBITDA, Industry | |
| Consumer Staples | 20.19 |
Based on: 10-K (reporting date: 2024-12-28).
1 Click competitor name to see calculations.
If the company EV/EBITDA is lower then the EV/EBITDA of benchmark then company is relatively undervalued.
Otherwise, if the company EV/EBITDA is higher then the EV/EBITDA of benchmark then company is relatively overvalued.
Enterprise Value to EBITDA Ratio, Historical
PepsiCo Inc., historical EV/EBITDA calculation, comparison to benchmarks
| Dec 28, 2024 | Dec 30, 2023 | Dec 31, 2022 | Dec 25, 2021 | Dec 26, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Enterprise value (EV)1 | 231,967) | 264,687) | 271,808) | 267,386) | 220,903) | |
| Earnings before interest, tax, depreciation and amortization (EBITDA)2 | 16,712) | 15,802) | 14,587) | 14,519) | 12,869) | |
| Valuation Ratio | ||||||
| EV/EBITDA3 | 13.88 | 16.75 | 18.63 | 18.42 | 17.17 | |
| Benchmarks | ||||||
| EV/EBITDA, Competitors4 | ||||||
| Coca-Cola Co. | 21.03 | 18.69 | 20.83 | 19.52 | 19.66 | |
| Mondelēz International Inc. | 11.48 | 14.65 | 21.64 | 15.62 | 15.14 | |
| Philip Morris International Inc. | 19.14 | 13.66 | 14.78 | 13.64 | 12.59 | |
| EV/EBITDA, Sector | ||||||
| Food, Beverage & Tobacco | 16.97 | 16.21 | 18.49 | 17.05 | 16.29 | |
| EV/EBITDA, Industry | ||||||
| Consumer Staples | 17.62 | 16.39 | 16.42 | 15.65 | 14.89 | |
Based on: 10-K (reporting date: 2024-12-28), 10-K (reporting date: 2023-12-30), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-25), 10-K (reporting date: 2020-12-26).
3 2024 Calculation
EV/EBITDA = EV ÷ EBITDA
= 231,967 ÷ 16,712 = 13.88
4 Click competitor name to see calculations.
The financial data reflects several notable trends and changes over the five-year period ending in 2024. These trends provide insight into the company's valuation relative to its earnings and its operational performance.
- Enterprise Value (EV)
- The enterprise value showed an upward trend from 2020 through 2022, rising from approximately 221 billion US dollars to nearly 272 billion US dollars. However, this value declined over the last two years, decreasing to approximately 232 billion US dollars by 2024. This decline may suggest changes in market perception, reduced market capitalization, or alterations in the company's net debt position.
- Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA)
- EBITDA exhibited consistent year-over-year growth throughout the entire period. Beginning at roughly 12.9 billion US dollars in 2020, it increased steadily each year, reaching about 16.7 billion US dollars in 2024. This steady increase in EBITDA indicates improving operational performance and potentially enhanced profitability or efficiency.
- EV/EBITDA Ratio
- The EV/EBITDA ratio demonstrated a rising trend from 17.17 in 2020 to a peak of 18.63 in 2022, indicating that the enterprise value was growing faster than operational earnings during this time. From 2023 onwards, the ratio declined to 13.88 by 2024. The reduction in this ratio suggests that either the market valuation is becoming more conservative relative to earnings or that EBITDA growth is outpacing enterprise value growth.
Overall, the data indicates consistent improvement in operating earnings, with EBITDA rising throughout the period. Despite this, enterprise value peaked in 2022 and then declined, leading to a decrease in the EV/EBITDA ratio by 2024. This may imply a more favorable valuation multiple for investors due to improved earnings or a decrease in market valuation. The combination of increasing EBITDA and decreasing EV/EBITDA ratio could be interpreted as the company becoming more financially attractive based on operational returns relative to its valuation.