PepsiCo Inc (PEP)
Financial leverage ratio
| Dec 31, 2023 | Sep 9, 2023 | Jun 17, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 3, 2022 | Jun 11, 2022 | Mar 19, 2022 | Dec 31, 2021 | Sep 4, 2021 | Jun 12, 2021 | Mar 20, 2021 | Dec 31, 2020 | Sep 5, 2020 | Jun 13, 2020 | Mar 21, 2020 | Dec 31, 2019 | Sep 7, 2019 | Mar 23, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 100,495,000 | 99,953,000 | 95,906,000 | 93,042,000 | 92,187,000 | 94,461,000 | 93,103,000 | 92,962,000 | 92,377,000 | 93,254,000 | 92,385,000 | 91,224,000 | 92,918,000 | 92,041,000 | 89,525,000 | 85,062,000 | 78,547,000 | 77,444,000 | 75,466,000 | 77,648,000 |
| Total stockholders’ equity | US$ in thousands | 18,503,000 | 18,806,000 | 17,685,000 | 17,042,000 | 17,149,000 | 18,977,000 | 18,553,000 | 18,202,000 | 16,043,000 | 15,872,000 | 15,299,000 | 13,947,000 | 13,454,000 | 13,483,000 | 12,491,000 | 13,465,000 | 14,786,000 | 14,129,000 | 14,202,000 | 14,518,000 |
| Financial leverage ratio | 5.43 | 5.31 | 5.42 | 5.46 | 5.38 | 4.98 | 5.02 | 5.11 | 5.76 | 5.88 | 6.04 | 6.54 | 6.91 | 6.83 | 7.17 | 6.32 | 5.31 | 5.48 | 5.31 | 5.35 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $100,495,000K ÷ $18,503,000K
= 5.43
The financial leverage ratio of PepsiCo Inc has shown fluctuations over the periods indicated. The ratio measures the company's reliance on debt to finance its operations and assets. A higher ratio indicates a higher proportion of debt in the company's capital structure.
From December 2018 to March 2019, the ratio remained relatively stable around 5.3 to 5.4. However, there was a notable increase from March 2019 to September 2020, peaking at 7.17 in June 2020, indicating a significant increase in debt relative to equity during this period.
Subsequently, there was a gradual decline in the ratio from September 2020 to September 2022, suggesting a reduction in the company's debt levels or an increase in equity financing. The lowest point was observed in September 2022 at 4.98 before an uptrend in the ratio was witnessed in the following quarters.
The recent trend from September 2022 to December 2023 shows a fluctuating pattern, with the ratio ranging between 5.31 and 5.46. This indicates that PepsiCo's financial leverage has been relatively stable in the most recent periods, but it remains higher compared to the earlier years of 2018 and 2019.
Overall, the analysis suggests that PepsiCo has experienced variations in its financial leverage ratio over time, reflecting changes in its capital structure and financing decisions. A high financial leverage ratio may indicate increased financial risk, as higher debt levels could lead to higher interest payments and potential solvency issues in challenging economic conditions.
Peer comparison
Dec 31, 2023