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BTI vs PEP

BTI
British American Tobacco p.l.c.
NEUTRAL
Price
$59.16
Market Cap
$128.41B
Sector
Consumer Defensive
AI Confidence
72%
PEP
PepsiCo, Inc.
NEUTRAL
Price
$154.85
Market Cap
$211.67B
Sector
Consumer Defensive
AI Confidence
85%

Valuation

P/E Ratio
BTI
31.47
PEP
25.81
Forward P/E
BTI
12.14
PEP
16.94
P/B Ratio
BTI
2.13
PEP
10.37
P/S Ratio
BTI
5.02
PEP
2.25
EV/EBITDA
BTI
13.09
PEP
14.05

Profitability

Gross Margin
BTI
82.86%
PEP
54.46%
Operating Margin
BTI
42.04%
PEP
14.07%
Profit Margin
BTI
12.06%
PEP
8.77%
ROE
BTI
6.27%
PEP
42.85%
ROA
BTI
5.59%
PEP
9.05%

Growth

Revenue Growth
BTI
-2.2%
PEP
5.6%
Earnings Growth
BTI
1.6%
PEP
67.5%

Financial Health

Debt/Equity
BTI
0.75
PEP
2.58
Current Ratio
BTI
0.87
PEP
0.85
Quick Ratio
BTI
0.53
PEP
0.64

Dividends

Dividend Yield
BTI
5.3%
PEP
3.65%
Payout Ratio
BTI
168.95%
PEP
93.71%

AI Verdict

BTI NEUTRAL

BTI's deterministic health score is stable with a Piotroski F-Score of 6/9, indicating moderate financial strength, though the absence of an Altman Z-Score limits distress risk assessment. The stock trades significantly above its Graham Number of $34.30 at $59.16, reflecting a rich valuation despite declining revenue and a concerning 168.95% dividend payout ratio. Strong operating margins and a high dividend yield provide support, but deteriorating growth and weak technicals (10/100) offset these advantages. Analysts recommend a buy with a near-current target price, suggesting limited upside.

Strengths
High dividend yield of 5.30% offers attractive income potential
Exceptional operating margin of 42.04% and gross margin of 82.86% reflect strong pricing power
Piotroski F-Score of 6 indicates stable financial health
Risks
Dividend payout ratio of 168.95% is unsustainable long-term
Revenue growth is negative YoY at -2.20%, indicating top-line contraction
Current ratio of 0.87 and quick ratio of 0.53 suggest short-term liquidity pressure
PEP NEUTRAL

PepsiCo exhibits a stable but mediocre deterministic health profile with a Piotroski F-Score of 4/9 and a high Debt/Equity ratio of 2.58. While the company maintains an exceptional earnings beat record over 25 quarters and a strong ROE of 42.85%, these are offset by a dangerously high dividend payout ratio of 93.71% and poor liquidity (Current Ratio 0.85). The stock currently trades below its growth-based intrinsic value of $177.0, but bearish insider activity and a 0/100 technical trend suggest limited immediate upside.

Strengths
Exceptional ROE of 42.85% indicating high efficiency in generating profit from equity
Consistent earnings track record with beats in nearly all of the last 25 quarters
Strong gross margins (54.46%) reflecting significant brand pricing power
Risks
Unsustainable dividend payout ratio of 93.71%, leaving little room for error or reinvestment
Weak liquidity position with a current ratio of 0.85 and quick ratio of 0.64
High leverage with a Debt/Equity ratio of 2.58, increasing vulnerability to interest rate shifts

Compare Another Pair

BTI vs PEP: Head-to-Head Comparison

This page compares British American Tobacco p.l.c. (BTI) and PepsiCo, Inc. (PEP) across key fundamental metrics including valuation ratios, profitability margins, growth rates, financial health indicators, and dividend metrics. Each metric highlights the better-performing stock so you can quickly identify relative strengths and weaknesses.

Our AI engine independently analyzes each company's financials, competitive position, and market conditions to produce a verdict (Bullish, Neutral, or Bearish) along with key strengths and risks. Use this comparison alongside your own research to make informed investment decisions.

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