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PepsiCo, Inc. (PEP) — WACC Analysis

WACC Breakdown

PepsiCo, Inc. (PEP) has a weighted average cost of capital (WACC) of 6.1%. The cost of equity is 6.9%, derived from a beta of 0.28 and a risk-free rate of 4.7%. The after-tax cost of debt is 2.1%. The capital structure is 82.1% equity and 17.9% debt.

Interpretation

A WACC of 6.1% suggests that the market views PepsiCo, Inc. as relatively low-risk, with a lower cost of financing.

Investors can compare PEP's WACC of 6.1% against industry peers to gauge its relative financing costs. A beta of 0.28 reflects the stock's volatility relative to the broader market.

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VALUATION

PEP WACC: 6.07% for PepsiCo, Inc.

Current inputs imply a 6.94% cost of equity and a 2.65% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.

[01]Current Market Data
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[02]
WACC Calculation Process
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Market Data Loaded
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Company Data Fetched
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Beta Calculated (5Y)
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Inputs Auto-Populated
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WACC Calculated
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Step 2: Enter Ticker Symbol
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Step 4: Review Auto-Populated WACC Inputs

Values are automatically populated from real data. You can adjust them manually if needed.

4.30%
1.000
4.23%
5.00%
21.00%
70.00%
Debt: 30.00%Equity: 70.00%

Please enter a valid company ticker to calculate WACC

PepsiCo, Inc. Common Stock (PEP) WACC Results
Weighted Average Cost of Capital
6.07%
Cost of Equity
6.94%
Risk-Free Rate4.74%
Beta0.28
Market Risk Premium4.23%
Cost of Debt
2.09%
Pre-Tax Cost of Debt2.65%
Tax Rate21.00%
Tax Shield0.56%
Capital Structure
Equity: 82.13%($195.83B)
Debt: 17.87%($42.61B)
Equity Component
5.70%
82.13% × 6.94%
Debt Component
0.37%
17.87% × 2.09%

PepsiCo, Inc. (PEP) WACC in context

PepsiCo, Inc. (PEP) currently screens with an estimated WACC of 6.07%. That blends a 6.94% cost of equity, a 2.65% pre-tax cost of debt, and a 82.13% equity weight into the discount rate you would typically use in a DCF model.

screens as a relatively low discount rate, which usually supports higher DCF values.

What PEP WACC implies

A 6.07% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates PEP

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 0.28 and equity accounts for 82.13% of capital.

What to do next

Validate business quality on the company page, then carry the same discount-rate assumptions into the DCF page to test fair value sensitivity.

Disclaimer: This is not financial advice. Data sourced from SEC EDGAR and Polygon.io. Past performance does not guarantee future results. Always conduct your own research before making investment decisions.

PEP WACC: 6.07% — PepsiCo, Inc. Cost of Capital (August 2026) | DeepViews