Common Stock Valuation Ratios (Price Multiples)
Valuation ratios measure the quantity of an asset or flaw (e.g., earnings) associated with ownership of a specified claim (e.g., a share of ownership of the enterprise).
Current Valuation Ratios
PepsiCo Inc., current price multiples
| PepsiCo Inc. | Coca-Cola Co. | Beverages | Consumer Goods | ||||
|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||
| Current share price (P) | $144.23 | ||||||
| No. shares of common stock outstanding | 1,381,956,485 | ||||||
| Growth rate (g) | 17.65% | ||||||
| Earnings per share (EPS) | $5.29 | ||||||
| Next year expected EPS | $6.23 | ||||||
| Operating profit per share | $7.45 | ||||||
| Sales per share | $48.60 | ||||||
| Book value per share (BVPS) | $10.70 | ||||||
| Valuation Ratios (Price Multiples) | |||||||
| Price to earnings (P/E) | 27.25 | 24.86 | 25.94 | 36.70 | |||
| Price to next year expected earnings | 23.16 | 31.82 | 25.35 | 33.41 | |||
| Price-earnings-growth (PEG) | 1.54 | — | 11.13 | 3.73 | |||
| Price to operating profit (P/OP) | 19.37 | 21.99 | 20.66 | 23.13 | |||
| Price to sales (P/S) | 2.97 | 5.95 | 4.03 | 3.85 | |||
| Price to book value (P/BV) | 13.48 | 11.68 | 12.47 | 11.78 | |||
Based on: 10-K (filing date: 2020-02-13).
If the company price multiple is lower then the price multiple of benchmark then company stock is relatively undervalued.
Otherwise, if the company price multiple is higher then the price multiple of benchmark then company stock is relatively overvalued.
Historical Valuation Ratios (Summary)
PepsiCo Inc., historical price multiples
Based on: 10-K (filing date: 2020-02-13), 10-K (filing date: 2019-02-15), 10-K (filing date: 2018-02-13), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-11).
| Valuation ratio | Description | The company |
|---|---|---|
| P/E ratio | The P/E ratio tells analyst how much an investor in common stock pays per dollar of current earnings. | PepsiCo Inc.’s P/E ratio decreased from 2017 to 2018 but then increased from 2018 to 2019 not reaching 2017 level. |
| P/OP ratio | Because P/E ratio is calculated using net income, the ratio can be sensitive to nonrecurring earnings and capital structure, analysts may use price to operating profit. | PepsiCo Inc.’s P/OP ratio increased from 2017 to 2018 and from 2018 to 2019. |
| P/S ratio | An rationale for the P/S ratio is that sales, as the top line in an income statement, are generally less subject to distortion or manipulation than other fundamentals such as EPS or book value. Sales are also more stable than earnings and never negative. | PepsiCo Inc.’s P/S ratio increased from 2017 to 2018 and from 2018 to 2019. |
| P/BV ratio | The P/BV ratio is interpreted as an indicator of market judgment about the relationship between a company’s required rate of return and its actual rate of return. | PepsiCo Inc.’s P/BV ratio decreased from 2017 to 2018 but then increased from 2018 to 2019 not reaching 2017 level. |
Price to Earnings (P/E)
PepsiCo Inc., historical P/E calculation, comparison to benchmarks
| Dec 28, 2019 | Dec 29, 2018 | Dec 30, 2017 | Dec 31, 2016 | Dec 26, 2015 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 1,389,544,618 | 1,404,686,108 | 1,419,908,267 | 1,427,214,232 | 1,445,412,743 | |
| Selected Financial Data (US$) | ||||||
| Net income available for PepsiCo common shareholders (in millions) | 7,314 | 12,513 | 4,853 | 6,323 | 5,446 | |
| Earnings per share (EPS)2 | 5.26 | 8.91 | 3.42 | 4.43 | 3.77 | |
| Share price1, 3 | 146.47 | 115.91 | 112.14 | 106.73 | 96.90 | |
| Valuation Ratio | ||||||
| P/E ratio4 | 27.83 | 13.01 | 32.81 | 24.09 | 25.72 | |
| Benchmarks | ||||||
| P/E Ratio, Competitors5 | ||||||
| Coca-Cola Co. | 28.21 | 30.47 | 150.54 | 27.48 | 26.01 | |
| P/E Ratio, Sector | ||||||
| Beverages | 28.04 | 18.94 | 56.89 | 25.81 | 25.89 | |
| P/E Ratio, Industry | ||||||
| Consumer Goods | 33.92 | 20.80 | 24.15 | 21.38 | 24.01 | |
Based on: 10-K (filing date: 2020-02-13), 10-K (filing date: 2019-02-15), 10-K (filing date: 2018-02-13), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-11).
1 Data adjusted for splits and stock dividends.
2 2019 Calculation
EPS = Net income available for PepsiCo common shareholders ÷ No. shares of common stock outstanding
= 7,314,000,000 ÷ 1,389,544,618 = 5.26
3 Closing price as at the filing date of PepsiCo Inc.’s Annual Report.
4 2019 Calculation
P/E ratio = Share price ÷ EPS
= 146.47 ÷ 5.26 = 27.83
5 Click competitor name to see calculations.
| Valuation ratio | Description | The company |
|---|---|---|
| P/E ratio | The P/E ratio tells analyst how much an investor in common stock pays per dollar of current earnings. | PepsiCo Inc.’s P/E ratio decreased from 2017 to 2018 but then increased from 2018 to 2019 not reaching 2017 level. |
Price to Operating Profit (P/OP)
PepsiCo Inc., historical P/OP calculation, comparison to benchmarks
| Dec 28, 2019 | Dec 29, 2018 | Dec 30, 2017 | Dec 31, 2016 | Dec 26, 2015 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 1,389,544,618 | 1,404,686,108 | 1,419,908,267 | 1,427,214,232 | 1,445,412,743 | |
| Selected Financial Data (US$) | ||||||
| Operating profit (in millions) | 10,291 | 10,110 | 10,509 | 9,785 | 8,353 | |
| Operating profit per share2 | 7.41 | 7.20 | 7.40 | 6.86 | 5.78 | |
| Share price1, 3 | 146.47 | 115.91 | 112.14 | 106.73 | 96.90 | |
| Valuation Ratio | ||||||
| P/OP ratio4 | 19.78 | 16.10 | 15.15 | 15.57 | 16.77 | |
| Benchmarks | ||||||
| P/OP Ratio, Competitors5 | ||||||
| Coca-Cola Co. | 24.95 | 22.54 | 25.05 | 20.80 | 21.91 | |
| P/OP Ratio, Sector | ||||||
| Beverages | 22.34 | 19.08 | 19.27 | 18.02 | 19.39 | |
| P/OP Ratio, Industry | ||||||
| Consumer Goods | 21.38 | 16.27 | 17.11 | 17.57 | 16.39 | |
Based on: 10-K (filing date: 2020-02-13), 10-K (filing date: 2019-02-15), 10-K (filing date: 2018-02-13), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-11).
1 Data adjusted for splits and stock dividends.
2 2019 Calculation
Operating profit per share = Operating profit ÷ No. shares of common stock outstanding
= 10,291,000,000 ÷ 1,389,544,618 = 7.41
3 Closing price as at the filing date of PepsiCo Inc.’s Annual Report.
4 2019 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= 146.47 ÷ 7.41 = 19.78
5 Click competitor name to see calculations.
| Valuation ratio | Description | The company |
|---|---|---|
| P/OP ratio | Because P/E ratio is calculated using net income, the ratio can be sensitive to nonrecurring earnings and capital structure, analysts may use price to operating profit. | PepsiCo Inc.’s P/OP ratio increased from 2017 to 2018 and from 2018 to 2019. |
Price to Sales (P/S)
PepsiCo Inc., historical P/S calculation, comparison to benchmarks
| Dec 28, 2019 | Dec 29, 2018 | Dec 30, 2017 | Dec 31, 2016 | Dec 26, 2015 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 1,389,544,618 | 1,404,686,108 | 1,419,908,267 | 1,427,214,232 | 1,445,412,743 | |
| Selected Financial Data (US$) | ||||||
| Net revenue (in millions) | 67,161 | 64,661 | 63,525 | 62,799 | 63,056 | |
| Sales per share2 | 48.33 | 46.03 | 44.74 | 44.00 | 43.62 | |
| Share price1, 3 | 146.47 | 115.91 | 112.14 | 106.73 | 96.90 | |
| Valuation Ratio | ||||||
| P/S ratio4 | 3.03 | 2.52 | 2.51 | 2.43 | 2.22 | |
| Benchmarks | ||||||
| P/S Ratio, Competitors5 | ||||||
| Coca-Cola Co. | 6.75 | 6.15 | 5.31 | 4.28 | 4.32 | |
| P/S Ratio, Sector | ||||||
| Beverages | 4.36 | 3.72 | 3.51 | 3.17 | 3.09 | |
| P/S Ratio, Industry | ||||||
| Consumer Goods | 3.56 | 2.98 | 3.20 | 3.17 | 2.85 | |
Based on: 10-K (filing date: 2020-02-13), 10-K (filing date: 2019-02-15), 10-K (filing date: 2018-02-13), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-11).
1 Data adjusted for splits and stock dividends.
2 2019 Calculation
Sales per share = Net revenue ÷ No. shares of common stock outstanding
= 67,161,000,000 ÷ 1,389,544,618 = 48.33
3 Closing price as at the filing date of PepsiCo Inc.’s Annual Report.
4 2019 Calculation
P/S ratio = Share price ÷ Sales per share
= 146.47 ÷ 48.33 = 3.03
5 Click competitor name to see calculations.
| Valuation ratio | Description | The company |
|---|---|---|
| P/S ratio | An rationale for the P/S ratio is that sales, as the top line in an income statement, are generally less subject to distortion or manipulation than other fundamentals such as EPS or book value. Sales are also more stable than earnings and never negative. | PepsiCo Inc.’s P/S ratio increased from 2017 to 2018 and from 2018 to 2019. |
Price to Book Value (P/BV)
PepsiCo Inc., historical P/BV calculation, comparison to benchmarks
| Dec 28, 2019 | Dec 29, 2018 | Dec 30, 2017 | Dec 31, 2016 | Dec 26, 2015 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 1,389,544,618 | 1,404,686,108 | 1,419,908,267 | 1,427,214,232 | 1,445,412,743 | |
| Selected Financial Data (US$) | ||||||
| Total PepsiCo shareholders’ equity (in millions) | 14,786 | 14,518 | 10,889 | 11,095 | 11,923 | |
| Book value per share (BVPS)2 | 10.64 | 10.34 | 7.67 | 7.77 | 8.25 | |
| Share price1, 3 | 146.47 | 115.91 | 112.14 | 106.73 | 96.90 | |
| Valuation Ratio | ||||||
| P/BV ratio4 | 13.76 | 11.21 | 14.62 | 13.73 | 11.75 | |
| Benchmarks | ||||||
| P/BV Ratio, Competitors5 | ||||||
| Coca-Cola Co. | 13.26 | 11.55 | 11.00 | 7.78 | 7.48 | |
| P/BV Ratio, Sector | ||||||
| Beverages | 13.48 | 11.39 | 12.41 | 9.71 | 8.84 | |
| P/BV Ratio, Industry | ||||||
| Consumer Goods | 10.89 | 8.39 | 8.74 | 8.54 | 7.91 | |
Based on: 10-K (filing date: 2020-02-13), 10-K (filing date: 2019-02-15), 10-K (filing date: 2018-02-13), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-11).
1 Data adjusted for splits and stock dividends.
2 2019 Calculation
BVPS = Total PepsiCo shareholders’ equity ÷ No. shares of common stock outstanding
= 14,786,000,000 ÷ 1,389,544,618 = 10.64
3 Closing price as at the filing date of PepsiCo Inc.’s Annual Report.
4 2019 Calculation
P/BV ratio = Share price ÷ BVPS
= 146.47 ÷ 10.64 = 13.76
5 Click competitor name to see calculations.
| Valuation ratio | Description | The company |
|---|---|---|
| P/BV ratio | The P/BV ratio is interpreted as an indicator of market judgment about the relationship between a company’s required rate of return and its actual rate of return. | PepsiCo Inc.’s P/BV ratio decreased from 2017 to 2018 but then increased from 2018 to 2019 not reaching 2017 level. |