Pepsico Performance Analysis

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Performance Analysis of PepsiCo, Inc. With the help of Financial Statement, Income Statement, Key Ratios and Stock price Analysis we can easily evaluate the financial performance of the Company and decide whether the investment of $100,000 will be beneficial in PepsiCo, Inc. or in Bank Account. So Firstly, we are evaluating the financial performance of the Company. Financial Position (Abstract) The key elements of Financial Statement and Income statement of the Company are shown in following table: PepsiCo, Inc. (Million) 2014 2013 2012 Net Income $6,513 $6,740 $6,178 Total Liabilities 52,961 53,089 $52,344 Retained Earning 49,092 46,420 $43,158 Property, Plant and Equipment 17,244 18,575 $19,136 Treasury Stock ($24,985) ($21,004) ($19,622)…show more content…
And Income Statement of the Company shows that company net income was increased in 2013 which shows that the company perform well in 2013. However, in 2014 the net income was decreased this may be due timing difference in sales and collection of cash from its customers. Increase in treasury stock indicates that the company considers that the shares are undervalued so it will be a good thing for the company because the company will by buying back its stock as well as reduces the outstanding number of shares. Hence, each shareholder earns more revenue. Key Ratio Analysis Ratio analysis is the most authentic analytical procedure for which users can evaluate the company’s performance in prior years as well as in the current period. With the help of Ratio analysis Shareholders of the company can easily evaluate the financial performance of the Company. Liquidity Ratio: According to the standard requirement if the company’s Current Ratio and quick ratio are 1 and 0.75 respectively then this will shows that companies perform well for their short term obligations. Liquidity Ratio…show more content…
So a high debt to equity ratio specifies the higher risk, because the debtors have further claims on the company's assets. Also A high debt to equity ratio generally means for financing growth, the company is heavily dependent on debt in and results in unpredictable earnings. June 2015 Mar 2015 Dec 2014 Sep 2014 Jun 2014 Debt to Equity Ratio 1.926 1.914 1.657 1.419 1.4 Debt to equity ratio of PepsiCo shows an increasing trend which is not a good sign for the company because this will indicate that the Company was more loaded in debt expense. Market Ratios: The dividend payout ratio is used to measure the % of net income during the year that was distributed to the shareholders of the Company in the form of dividends. So the Investors are normally concerned with this ratio because the investors need to know whether the companies are paying a rational portion of net income to investors. June 2015 Mar 2015 Dec 2014 Sep 2014 Jun 2014 Dividend Payout Ratio 19.64% 12.07% 9.43% 1.92% 8.33% The dividend payout ratio of PepsiCo shows a quarterly dividend in the second quarter of 2015 of $ 0.67 which indicating growth of 3.08% from the previous quarter increase of 19.64% year on year. Stock Price

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