PepsiCo vs Starbucks
Add, change or remove companies; up to four.
KIRA’s take AI analyst
I put PepsiCo and Starbucks side by side, using each one’s latest annual report. Here is what stands out:
- PepsiCo is the larger business, with $93.9B of revenue in fiscal 2025 against $37.2B for Starbucks, about 2.5 times as much.
- Starbucks grew revenue faster (2.8%, against 2.3%).
- PepsiCo kept more of each dollar of sales as operating profit (12.2% operating margin, against 7.9%).
- PepsiCo turned more of its sales into free cash flow (8.2% FCF margin, against 6.6%).
- Starbucks earned a higher return on the capital invested in it (47.8%, against 16.4%).
- Investors pay more for each dollar of Starbucks’s earnings: a P/E of 59.0x against 17.0x for PepsiCo.
Who comes out ahead
Of the 9 measures where higher (or lower) is clearly better, how many each company leads.
PepsiCo
PEP
6/9
Operating marginNet marginFCF marginPiotroski F-scoreNet debt / EBITDAShare count change
Starbucks
SBUX
3/9
Revenue growth5-year growthReturn on capital
Side by side
Best in the row
| Latest fiscal year | PEP FY25 | SBUX FY25 |
|---|---|---|
| Size | ||
| Market cap | $185.2B | $117.5B |
| Revenue | $93.9B | $37.2B |
| Free cash flow | $7.7B | $2.4B |
| Net income | $8.2B | $1.9B |
| Growth | ||
| Revenue growth | 2.3% | 2.8% |
| 5-year growth | 5.9% | 9.6% |
| Share count change | −0.4% | 0.2% |
| Profitability | ||
| Gross margin | 54.2% | — |
| Operating margin | 12.2% | 7.9% |
| Net margin | 8.8% | 5.0% |
| FCF margin | 8.2% | 6.6% |
| Return on capital | 16.4% | 47.8% |
| Return on equity | 42.9% | — |
| Balance sheet | ||
| Net debt | $39.7B | $12.6B |
| Net debt / EBITDA | 2.7x | 2.7x |
| Dividends and buybacks | $8.6B | $2.8B |
| Valuation & quality | ||
| P/E | 17.0x | 59.0x |
| Piotroski F-score | 6 | 4 |
Ten years
Revenue
Operating margin
Free cash flow
Return on capital
Each company's latest fiscal year; fiscal years end in different months. The best value in each row is highlighted where higher (or lower) is clearly better. Not investment advice.