PepsiCo (PEP) is one of the Dividend Kings, boasting an impressive 53-year consecutive increase and a continuous payout for 60 years. The current dividend yield is 4.2% (as of April 2025), with forecasts suggesting an increase to over 4.6% by 2027.
Key Aspects of the PepsiCo Dividend
- Historical Reliability: The dividend has been raised by an average of 7.6% annually over the last decade.
- Payment Schedule: Announcement on May 6, 2025, Ex-Date on June 6, 2025, and payment on June 30, 2025.
- Share Buybacks: Planned buybacks worth $1 billion to support the stock price while distributing $7.6 billion in dividends.
Forecast and Yield Development
The following table shows the development of dividend yields and payouts:
| Calendar Year | Dividend Yield | Dividend in Euros |
|---|---|---|
| 2025e | 4.18% | 5.555€ |
| 2026e | 4.44% | 5.88€ |
| 2027e | 4.65% | 6.17€ |
Source: wallstreetONLINE based on PepsiCo data
Current Challenges
Despite stable dividend payments, PepsiCo anticipates a projected decline in core earnings of ~3% for FY25, due to geopolitical risks and supply chain issues in concentrate production outside the US, particularly in Ireland. Nevertheless, the stock is considered undervalued with historically high yield attractiveness.
In the long term, the company is focusing on growth through healthier snack alternatives and international expansion, which supports the sustainability of dividend payments. An ROI of up to 8.49% solely from dividends underscores the return potential for buy-and-hold investors.