Market Pulse59Neutral

PepsiCo, Inc.Opportunity Rank #87(PEP) Intrinsic Value & DCF Analysis (2026)

Current Price

$156.29

Last updated: May 08, 2026

Price vs Intrinsic Value

$156.29
Price
$198.70
Intrinsic Value
Undervalued by 27%MOS: $158.96

Fundamental Score

50/100
Neutral

Weighted across 6 signals

Narrative Score

80/100
Strong

No change vs previous

Trend Score

42/100
Weak

As of 2026-05-08

The intrinsic value of PepsiCo, Inc. (PEP) is estimated at $198.70 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $156.29, the stock appears undervalued relative to its projected cash flow fundamentals. This estimate assumes a 2.76% long-term growth rate and an 8.00% discount rate (calculated: 6.64%), reflecting expected future free cash flow and cost of capital.

The intrinsic value of PepsiCo, Inc. (PEP) is estimated at $198.70 per share based on a 10-year discounted cash flow (DCF) analysis. At the current price of $156.29, the stock appears undervalued relative to its projected cash flow fundamentals. This estimate assumes a 2.76% long-term growth rate and an 8.00% discount rate (calculated: 6.64%), reflecting expected future free cash flow and cost of capital.

Valuation Details

$198.70
27.14% upside
20% margin of safety: $158.96
Years: 10Growth Rate: 2.76%
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Capital Efficiency

Average Quarterly ROIC
3.86%
Cost of Capital (estimated)11%
Value StatusUnderperforming Capital

The company is earning below its required return. This may indicate inefficient use of capital or excess cash that isn't being reinvested.

Complete historical ROIC is available with
.

Fundamental Details

50/100
NeutralWeighted across 6 signals
DCF Discount
27.1% discount to price
95
FCF Yield
8.1% trailing FCF yield
100
ROIC vs WACC
ROIC 3.9% vs WACC 11.0% (0.4x)
18
Net Debt / FCF
2.4x net debt to FCF
18
Buybacks
Share count flat
50
FCF CAGR (5Y)
3.2% 5Y FCF CAGR
25
Strengths: DCF Discount, FCF Yield. Concerns: ROIC vs WACC, Net Debt / FCF.

Narrative Details

80/100
Strong
Vs 6-Month Baseline:Above Avg (64th pct)Weighted across 6 recent drivers
Trend: StableConfidence: 99%Updated: 17h ago
Sources: 202 (194 News · 8 Analyst)
Drivers(last 30 days)
135 news sentiment+3.5
7 earnings beat+0.8
41 regulatory scrutiny+0.7
6 promotions/discounting+0.1
3 legal risk-0.0
2 upgrade headlines+0.0

Trend Details

42/100
WeakAs of 2026-05-08311 daily bars used
3M Relative Strength vs SPY-16.1%
Distance from 52-Week High-9.3%
Price vs 21 EMA-0.8%
Price vs 21 EMA45 · -0.8%
Price vs 50 EMA45 · -0.9%
21 EMA vs 50 EMA49 · -0.1%
3M RS vs SPY6 · -16.1%
6M RS vs SPY48 · -0.6%
Distance from 52W High81 · -9.3%

Investment Coach

Updated 20h ago
BUYConfidence: 55%
Thesis
PepsiCo, Inc. is undervalued with an estimated fair value 29.3% above its current price, supported by a healthy free cash flow yield of 8.1% and an improving narrative score of 80. Despite trailing returns relative to its cost of capital, the company's fundamentals and valuation present a medium-confidence buy opportunity.
Key Risk
The key risk is the negative spread between ROIC and WACC, indicating returns are currently below the cost of capital, which may pressure valuation and growth prospects.
Signals To Watch
  • Monitor whether valuation discount remains above 10%.
  • Track ROIC vs WACC spread for sustained improvement.
  • Follow narrative trend for meaningful shifts in the score direction.
Ask the Coach - Available with
Historical Growth Rates
Free Cash Flow- - -Trend CAGR: 2.76%5 Year CAGR: 1.34%

Free Cash Flow (in millions)

TTM20252024202320222021202020192018201720162015201420132012201120102009200820072006
$17,360$16,502$17,825$18,960$16,018$16,241$14,853$13,881$12,697$12,963$13,444$13,338$13,365$12,483$11,193$12,283$11,701$8,924$9,445$9,364$8,152

How Intrinziq Estimates Fair Value

Intrinziq estimates PepsiCo, Inc.'s intrinsic value using a discounted cash flow (DCF) model based on free cash flow trends and a market-based discount rate. The model projects future cash flows over ten years and discounts them using a market return assumption to estimate fair value.

PepsiCo, Inc.Consumer Defensive

PepsiCo, Inc. manufactures, markets, distributes, and sells various beverages and convenient foods worldwide. The company operates through seven segments: Frito-Lay North America; Quaker Foods North America; PepsiCo Beverages North America; Latin America; Europe; Africa, Middle East and South Asia; and Asia Pacific, Australia and New Zealand and China Region. It provides dips, cheese-flavored snacks, and spreads, as well as corn, potato, and tortilla chips; cereals, rice, pasta, mixes and syrups, granola bars, grits, oatmeal, rice cakes, simply granola, and side dishes; beverage concentrates, fountain syrups, and finished goods; ready-to-drink tea, coffee, and juices; dairy products; and sparkling water makers and related products. It serves wholesale and other distributors, foodservice customers, grocery stores, drug stores, convenience stores, discount/dollar stores, mass merchandisers, membership stores, hard discounters, e-commerce retailers and authorized independent bottlers, and others through a network of direct-store-delivery, customer warehouse, and distributor networks, as well as directly to consumers through e-commerce platforms and retailers. The company was founded in 1898 and is headquartered in Purchase, New York.