PepsiCo Inc (PEP)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 54.21% | 53.03% | 53.35% | 54.82% | 55.13% |
| Operating profit margin | 13.10% | 13.33% | 14.04% | 14.32% | 15.32% |
| Pretax margin | 12.39% | 12.31% | 12.28% | 12.81% | 13.81% |
| Net profit margin | 9.92% | 10.31% | 9.59% | 10.12% | 10.89% |
PepsiCo Inc's profitability ratios have shown some fluctuations over the past five years. The gross profit margin, a measure of how well the company generates revenue from its core operations, has ranged from 53.03% to 55.13%, with a slight increase in 2023 compared to the previous year.
The operating profit margin, which indicates the efficiency of the company in controlling operating expenses, has experienced a slight decline from 15.32% in 2019 to 13.10% in 2023. This may suggest that PepsiCo has faced challenges in managing operating costs over the years.
The pretax margin, depicting the proportion of earnings before taxes generated from revenue, has fluctuated between 12.28% and 13.81% over the period. The slight decrease in 2023 compared to 2019 could indicate that the company's tax obligations have increased relative to its earnings.
The net profit margin, a key indicator of overall profitability, has also shown variability, ranging from 9.59% to 10.89%. The decrease in 2023 compared to the previous year could imply that after-tax profits have declined slightly.
In summary, while PepsiCo Inc has maintained relatively healthy profitability ratios over the years, there have been fluctuations in certain margins, which may require further analysis to understand the underlying factors impacting the company's profitability.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 11.93% | 12.49% | 12.08% | 10.85% | 13.10% |
| Return on assets (ROA) | 9.03% | 9.67% | 8.25% | 7.66% | 9.31% |
| Return on total capital | 21.67% | 21.92% | 22.32% | 18.84% | 23.23% |
| Return on equity (ROE) | 49.04% | 51.96% | 47.48% | 52.92% | 49.47% |
PepsiCo Inc's profitability ratios demonstrate consistent performance over the past five years, reflecting the company's ability to generate returns for its stakeholders.
The Operating Return on Assets (Operating ROA) measures the efficiency of the company in generating operating income from its assets. While there was a slight decrease in 2023 compared to previous years, PepsiCo maintained a healthy level above 10%, indicating effective asset utilization in its operations.
The Return on Assets (ROA) indicates how well the company is utilizing its assets to generate profits. PepsiCo's ROA remained relatively stable around 9% over the period, reflecting consistent profitability relative to its asset base.
The Return on Total Capital measures the overall return generated on both debt and equity capital invested in the company. With values consistently above 18% and peaking at 22.32% in 2021, PepsiCo exhibited strong performance in generating returns for all capital providers.
The Return on Equity (ROE) reflects the profitability generated for the company's shareholders. Despite minor fluctuations, PepsiCo maintained ROE above 45% throughout the period, indicating high returns to equity investors. The highest ROE was recorded in 2022 at 51.96%.
Overall, PepsiCo Inc's profitability ratios demonstrate a stable and profitable performance, showcasing efficiency in asset utilization and strong returns for both capital providers and equity investors.