PEP sharp with cashflow still close to a record high
PEP Current 170 Target 190 + 12%
Jul 13, 2022
1 minute read
Sales grew 25% from the first quarter.
Last 5 quarters
30% 5% 25% -36% 25%
Costs down profit down
Last 5 quarters
-85% -85% -90% -86% -84%
Cashflow lower
Last 5 quarters million dollars
2,647, 2,025, 397, 5,232, 2,443
Balance sheet net cash worsened
Last 5 quarters million dollars
-71,538 -70,758 -70,630 -68,081 -69,024
Capital paid improved , a 12% higher target price
Last 5 quarters million dollars
9,944, 12,627, 15,310, 17,369, 19,427
Jul 13, 2022
1 minute read
Sales grew 25% from the first quarter.
Last 5 quarters
30% 5% 25% -36% 25%
- Sales grew 25% in the second quarter to 20,225 million dollars which is +5% from a year ago.
- This brings the average to 5% growth a quarter in the last 12 months.
- We predict average growth of 5% again in this next 12 months to bring sales to 21,581 million dollars in the second quarter 2023.
Costs down profit down
Last 5 quarters
-85% -85% -90% -86% -84%
- The cash cost ratio went from -86% to -84% profit from 4,273 to 1,446 million dollars in the second quarter with higher non cash costs.
- The average cost ratio is at -86% now.
- We use the average -86% cost ratio to predict a 2,505 million dollars profit in the second quarter 2023.
Cashflow lower
Last 5 quarters million dollars
2,647, 2,025, 397, 5,232, 2,443
- Free cashflow went from 5,232 to 2,443 million dollars in the second quarter with -783 million dollars investment cashflow (after a large gain last quarter).
- Average quarterly Cashflow is at 2,524 million dollars now.
- We assume lower -245 million dollars investment spending which with higher sales gives 2,722 million dollars Cashflow in the second quarter 2023.
Balance sheet net cash worsened
Last 5 quarters million dollars
-71,538 -70,758 -70,630 -68,081 -69,024
- Cash declined 6,561 to 5,405 million dollars in the second quarter.
- Liabilities declined 74,642 to 74,429 million dollars so net cash worsened -68,081 to -69,024 million dollars .
- With our forecast cashflow & a -7,164 million dollars equity payout -3,789 million dollars liabilities payment net cash will be -65,235 million dollars in 12 months time.
Capital paid improved , a 12% higher target price
Last 5 quarters million dollars
9,944, 12,627, 15,310, 17,369, 19,427
- PEP 14 quarter capital paid improved 17,369 to 19,427 million dollars in the second quarter with + 212 million dollars from liabilities + 1,847 million dollars from equity & will be 30,380 million dollars in12 months time.
- At the current market value of 234,364 million dollars based on our forecasts it’s at 2.54 X assets with an 8 years asset to cashflow payback & a 3% yield.
- Our cashflow forecast is 10,953 million dollars which means a 21 X valuation. A 24 X valuation gives a 12% higher target price 190 dollars.
