PEP vs. PM: A Head-to-Head Stock Comparison
Here’s a clear look at PEP and PM, comparing key factors like historical performance, profitability, financial strength, growth, dividend, and valuation.
Company Profile
| Symbol | PEP | PM |
|---|---|---|
| Company Name | PepsiCo, Inc. | Philip Morris International Inc. |
| Country | United States | United States |
| GICS Sector | Consumer Staples | Consumer Staples |
| GICS Industry Group | Food, Beverage & Tobacco | Food, Beverage & Tobacco |
| GICS Industry | Beverages | Tobacco |
| GICS Sub-Industry | Soft Drinks & Non-alcoholic Beverages | Tobacco |
| Market Capitalization | 204.23 billion USD | 283.83 billion USD |
| Currency | USD | USD |
| Exchange | NasdaqGS | NYSE |
| Listing Date | June 1, 1972 | March 17, 2008 |
| Security Type | Common Stock | Common Stock |
PEP’s market capitalization stands at 204.23 billion USD, while PM’s is 283.83 billion USD, indicating their market valuations are broadly comparable.
Historical Performance
This chart compares the performance of PEP and PM by tracking the growth of an initial $10,000 investment in each. Use the tabs to select the desired time period. Data is adjusted for dividends and splits.
Historical Performance at a Glance
| Symbol | PEP | PM |
|---|---|---|
| 5-Day Price Return | -3.63% | 7.46% |
| 13-Week Price Return | -12.36% | -0.38% |
| 26-Week Price Return | 4.05% | 25.94% |
| 52-Week Price Return | 14.54% | 7.31% |
| Month-to-Date Return | -5.73% | 10.32% |
| Year-to-Date Return | 4.10% | 13.53% |
| 10-Day Avg. Volume | 5.53M | 4.62M |
| 3-Month Avg. Volume | 7.32M | 5.17M |
| 3-Month Volatility | 20.26% | 34.22% |
| Beta | 0.39 | 0.42 |
With betas of 0.39 for PEP and 0.42 for PM, both stocks show similar sensitivity to overall market movements.
Profitability
Return on Equity (TTM)
PEP
43.89%
Beverages Industry
- Max
- 43.89%
- Q3
- 25.65%
- Median
- 19.93%
- Q1
- 12.01%
- Min
- -7.30%
In the upper quartile for the Beverages industry, PEP’s Return on Equity of 43.89% signals a highly effective use of shareholder capital to drive profitability compared to most of its peers.
PM
575.44%
Tobacco Industry
- Max
- 149.65%
- Q3
- 149.65%
- Median
- 6.40%
- Q1
- 5.81%
- Min
- 5.75%
PM’s Return on Equity of 575.44% is exceptionally high, placing it well beyond the typical range for the Tobacco industry. This demonstrates a superior ability to generate profit from shareholder investments, though it could also be inflated by high financial leverage.
Net Profit Margin (TTM)
PEP
9.15%
Beverages Industry
- Max
- 27.80%
- Q3
- 18.46%
- Median
- 11.53%
- Q1
- 8.15%
- Min
- -3.15%
PEP’s Net Profit Margin of 9.15% is aligned with the median group of its peers in the Beverages industry. This indicates its ability to convert revenue into profit is typical for the sector.
PM
27.92%
Tobacco Industry
- Max
- 30.32%
- Q3
- 29.84%
- Median
- 27.92%
- Q1
- 23.29%
- Min
- 23.29%
PM’s Net Profit Margin of 27.92% is aligned with the median group of its peers in the Tobacco industry. This indicates its ability to convert revenue into profit is typical for the sector.
Operating Profit Margin (TTM)
PEP
12.41%
Beverages Industry
- Max
- 30.01%
- Q3
- 28.39%
- Median
- 20.83%
- Q1
- 12.41%
- Min
- -4.08%
PEP’s Operating Profit Margin of 12.41% is around the midpoint for the Beverages industry, indicating that its efficiency in managing core business operations is typical for the sector.
PM
36.64%
Tobacco Industry
- Max
- 42.52%
- Q3
- 39.04%
- Median
- 36.64%
- Q1
- 8.30%
- Min
- 7.28%
PM’s Operating Profit Margin of 36.64% is around the midpoint for the Tobacco industry, indicating that its efficiency in managing core business operations is typical for the sector.
Profitability at a Glance
| Symbol | PEP | PM |
|---|---|---|
| Return on Equity (TTM) | 43.89% | 575.44% |
| Return on Assets (TTM) | 8.12% | 16.82% |
| Net Profit Margin (TTM) | 9.15% | 27.92% |
| Operating Profit Margin (TTM) | 12.41% | 36.64% |
| Gross Profit Margin (TTM) | 54.38% | 67.12% |
Financial Strength
Current Ratio (MRQ)
PEP
0.90
Beverages Industry
- Max
- 3.70
- Q3
- 2.31
- Median
- 1.16
- Q1
- 0.93
- Min
- 0.54
PEP’s Current Ratio of 0.90 falls into the lower quartile for the Beverages industry. This indicates a tighter liquidity situation and a more constrained capacity to handle short-term debt than many of its competitors.
PM
0.96
Tobacco Industry
- Max
- 5.70
- Q3
- 2.91
- Median
- 0.96
- Q1
- 0.87
- Min
- 0.65
PM’s Current Ratio of 0.96 aligns with the median group of the Tobacco industry, indicating that its short-term liquidity is in line with its sector peers.
Debt-to-Equity Ratio (MRQ)
PEP
2.47
Beverages Industry
- Max
- 2.03
- Q3
- 1.31
- Median
- 0.84
- Q1
- 0.57
- Min
- 0.00
With a Debt-to-Equity Ratio of 2.47, PEP operates with exceptionally high leverage compared to the Beverages industry norm. This suggests an aggressive reliance on debt financing, which can magnify returns but also significantly elevates financial risk.
PM
186.08
Tobacco Industry
- Max
- 8.67
- Q3
- 8.67
- Median
- 0.75
- Q1
- 0.73
- Min
- 0.01
With a Debt-to-Equity Ratio of 186.08, PM operates with exceptionally high leverage compared to the Tobacco industry norm. This suggests an aggressive reliance on debt financing, which can magnify returns but also significantly elevates financial risk.
Interest Coverage Ratio (TTM)
PEP
10.17
Beverages Industry
- Max
- 67.13
- Q3
- 50.14
- Median
- 11.78
- Q1
- 7.99
- Min
- -10.77
PEP’s Interest Coverage Ratio of 10.17 is positioned comfortably within the norm for the Beverages industry, indicating a standard and healthy capacity to cover its interest payments.
PM
15.37
Tobacco Industry
- Max
- 20.61
- Q3
- 17.71
- Median
- 15.37
- Q1
- 3.30
- Min
- -11.45
PM’s Interest Coverage Ratio of 15.37 is positioned comfortably within the norm for the Tobacco industry, indicating a standard and healthy capacity to cover its interest payments.
Financial Strength at a Glance
| Symbol | PEP | PM |
|---|---|---|
| Current Ratio (MRQ) | 0.90 | 0.96 |
| Quick Ratio (MRQ) | 0.67 | 0.51 |
| Debt-to-Equity Ratio (MRQ) | 2.47 | 186.08 |
| Interest Coverage Ratio (TTM) | 10.17 | 15.37 |
Growth
Revenue Growth
Revenue Growth at a Glance
| Symbol | PEP | PM |
|---|---|---|
| Revenue Growth (MRQ vs Prior YoY) | 8.50% | 6.76% |
| Revenue Growth (TTM vs Prior YoY) | 4.29% | 7.31% |
| 3-Year Revenue CAGR | 2.83% | 8.57% |
| 5-Year Revenue CAGR | 5.94% | 7.21% |
EPS Growth
EPS Growth at a Glance
| Symbol | PEP | PM |
|---|---|---|
| EPS Growth (MRQ vs Prior YoY) | 27.35% | -- |
| EPS Growth (TTM vs Prior YoY) | -6.44% | 60.61% |
| 3-Year EPS CAGR | -2.24% | 7.70% |
| 5-Year EPS CAGR | 3.25% | 7.09% |
Dividend
Dividend Yield (TTM)
PEP
3.78%
Beverages Industry
- Max
- 4.93%
- Q3
- 4.20%
- Median
- 3.27%
- Q1
- 2.61%
- Min
- 0.72%
PEP’s Dividend Yield of 3.78% is consistent with its peers in the Beverages industry, providing a dividend return that is standard for its sector.
PM
3.04%
Tobacco Industry
- Max
- 6.07%
- Q3
- 6.03%
- Median
- 5.67%
- Q1
- 3.04%
- Min
- 0.00%
PM’s Dividend Yield of 3.04% is consistent with its peers in the Tobacco industry, providing a dividend return that is standard for its sector.
Dividend Payout Ratio (TTM)
PEP
88.42%
Beverages Industry
- Max
- 131.99%
- Q3
- 95.28%
- Median
- 68.23%
- Q1
- 42.43%
- Min
- 0.00%
PEP’s Dividend Payout Ratio of 88.42% is within the typical range for the Beverages industry, suggesting a balanced approach between shareholder payouts and company reinvestment.
PM
76.00%
Tobacco Industry
- Max
- 100.19%
- Q3
- 94.87%
- Median
- 76.00%
- Q1
- 67.47%
- Min
- 67.47%
PM’s Dividend Payout Ratio of 76.00% is within the typical range for the Tobacco industry, suggesting a balanced approach between shareholder payouts and company reinvestment.
Dividend at a Glance
| Symbol | PEP | PM |
|---|---|---|
| Dividend Yield (TTM) | 3.78% | 3.04% |
| Dividend Payout Ratio (TTM) | 88.42% | 76.00% |
Valuation
Price-to-Earnings Ratio (TTM)
PEP
23.39
Beverages Industry
- Max
- 24.52
- Q3
- 22.62
- Median
- 19.34
- Q1
- 16.15
- Min
- 14.81
A P/E Ratio of 23.39 places PEP in the upper quartile for the Beverages industry. This high valuation relative to peers suggests the market holds elevated expectations for the company’s future growth.
PM
25.01
Tobacco Industry
- Max
- 19.28
- Q3
- 19.28
- Median
- 16.52
- Q1
- 15.74
- Min
- 11.89
At 25.01, PM’s P/E Ratio is exceptionally high, exceeding the typical maximum for the Tobacco industry. This suggests the stock may be significantly overvalued compared to its peers and implies high market expectations that could be difficult to meet.
Price-to-Sales Ratio (TTM)
PEP
2.14
Beverages Industry
- Max
- 3.18
- Q3
- 2.91
- Median
- 2.36
- Q1
- 1.43
- Min
- 0.73
PEP’s P/S Ratio of 2.14 aligns with the market consensus for the Beverages industry. This suggests its valuation, based on sales, is seen as standard and is on par with its competitors.
PM
6.98
Tobacco Industry
- Max
- 4.93
- Q3
- 4.93
- Median
- 4.49
- Q1
- 3.60
- Min
- 3.60
With a P/S Ratio of 6.98, PM trades at a valuation that eclipses even the highest in the Tobacco industry. This implies the market has priced in exceptionally optimistic scenarios for future revenue growth, posing considerable valuation risk.
Price-to-Book Ratio (MRQ)
PEP
9.65
Beverages Industry
- Max
- 9.81
- Q3
- 5.47
- Median
- 3.36
- Q1
- 2.48
- Min
- 0.76
PEP’s P/B Ratio of 9.65 is in the upper tier for the Beverages industry. This indicates that investors are paying a premium relative to the company’s net assets, a valuation that hinges on its ability to generate superior profits.
PM
1,368.86
Tobacco Industry
- Max
- 27.09
- Q3
- 27.09
- Median
- 1.62
- Q1
- 1.21
- Min
- 0.89
At 1,368.86, PM’s P/B Ratio is at an extreme premium to the Tobacco industry. This signifies that the market’s valuation is heavily reliant on future potential rather than its current net asset value, which can be a high-risk proposition.
Valuation at a Glance
| Symbol | PEP | PM |
|---|---|---|
| Price-to-Earnings Ratio (TTM) | 23.39 | 25.01 |
| Price-to-Sales Ratio (TTM) | 2.14 | 6.98 |
| Price-to-Book Ratio (MRQ) | 9.65 | 1,368.86 |
| Price-to-Free Cash Flow Ratio (TTM) | 22.09 | 24.86 |