Morningstar Rating
Stock XNAS Rating as of
$35.39 +0.06(0.17%)
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Company Report
Company Report
Keurig Dr Pepper Earnings: Ready-to-Drink Beverage Performance Resilient, but Coffee Still a Drag
Dan Su
We don't plan material changes to our $32 fair value estimate on narrow-moat Keurig Dr Pepper after second-quarter sales and adjusted EPS, led by a strong performance in ready-to-drink beverages, were up 4% and 7%, respectively, even as coffee weakness persists. There is no change to our 2024 forecast for sales and adjusted EPS to grow 4% and 7%, respectively, and our 10-year estimates remain in place for mid-single-digit annual sales growth and operating margins in the low 20s. We view shares as fully valued.
KDP is trading at a 177% premium.
Price
$35.39
Fair Value
$88.00
Uncertainty
Medium
- 1-Star Price
- $87.90
- 5-Star Price
- $36.40
- Economic Moat
- Zlvksy
- Capital Allocation
- Gswzprstg
Bulls Say, Bears Say
Bulls Say, Bears Say
Bulls
Keurig remains the number one single-serve brewer maker in North America, with strong retail relationships and a large installed base.
Bears
Secular headwinds in carbonated soft drink demand in the US and Canada are a challenge to Keurig Dr Pepper’s long-term growth outlook.
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News
News
- Keurig Dr Pepper 2Q Volume Gains Boost Sales
- Keurig Dr Pepper Reports Q2 2024 Results and Reaffirms Fiscal 2024 Guidance
- Keurig Dr Pepper Currently Down 10 Straight Days, on Pace for Longest Losing Streak Since July 2019 — Data Talk
- Keurig Dr Pepper on Pace for Longest Losing Streak Since July 2019 — Data Talk
- FDA revokes regulation allowing use of brominated vegetable oil in food
- Keurig Dr Pepper to Report Second Quarter 2024 Results and Host Conference Call
- Keurig Dr Pepper Highlights Meaningful Progress Towards Ambitious Commitments in Latest Corporate Responsibility Report
- The Original Donut Shop® and Kelsea Ballerini Announce Co-Branded Ballerini Blend
Trading Information
Trading Information
- Previous Close Price
- $35.33
- Day Range
$35.24–35.46
- 52-Week Range
$27.66–35.53
- Bid/Ask
- $35.11/$35.39
- Market Cap
- $47.99 Bil
- Volume/Avg
- 7.0 Mil/7.8 Mil
Key Statistics
Key Statistics
- Price/Earnings (Normalized)
- 20.34
- Price/Sales
- 3.26
- Dividend Yield (Trailing)
- 2.43%
- Dividend Yield (Forward)
- 2.43%
- Total Yield
- 5.25%
Company Profile
Company Profile
Keurig Dr Pepper was established in 2018 following a merger between Keurig Green Mountain Coffee and Dr Pepper Snapple. The company manufactures and distributes coffee systems (including coffee brewers and single-serve coffee pods) under the Keurig and Green Mountain brands, as well as ready-to-drink beverages including flavored (non-cola) sparkling soft drinks under well-known brands such as Dr Pepper, Snapple, and Canada Dry. The company controls production and route to market for its own brands through in-house manufacturing plants and distribution infrastructure and leverages these facilities to manufacture and distribute for third-party coffee and beverage brands via licensing and partnership agreements. US and Canada make up 95% of revenues, with the rest from Mexico.
- Sector
- Consumer Defensive
- Industry
- Beverages - Non-Alcoholic
- Stock Style Box
- Mid Core
- Total Number of Employees
- 28,100
- Website
- https://www.keurigdrpepper.com
Competitors
Competitors
- PepsiCo Inc PEP
- Coca-Cola Co KO
- Monster Beverage Corp MNST
Valuation
Valuation
| Metric | KDP | PEP | KO |
|---|---|---|---|
Price/Earnings (Normalized) | 20.34 | 21.80 | 24.80 |
Price/Book Value | 1.94 | 12.20 | 11.53 |
Price/Sales | 3.26 | 2.59 | 6.44 |
Price/Cash Flow | 15.30 | 17.47 | 22.76 |
Price/Earnings
KDP
PEP
KO
Financial Strength
Financial Strength
| Metric | KDP | PEP | KO |
|---|---|---|---|
Quick Ratio | 0.26 | 0.60 | 0.80 |
Current Ratio | 0.51 | 0.83 | 1.08 |
Interest Coverage | 5.14 | 14.88 | 8.52 |
Quick Ratio
KDP
PEP
KO
Profitability
Profitability
| Metric | KDP | PEP | KO |
|---|---|---|---|
Return on Assets (Normalized) | 4.98% | 11.02% | 12.21% |
Return on Equity (Normalized) | 10.31% | 58.48% | 46.22% |
Return on Invested Capital (Normalized) | 7.72% | 18.27% | 17.96% |
Return on Assets
KDP
PEP
KO
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Beverages - Non-Alcoholic Industry Comparables
Beverages - Non-Alcoholic Industry Comparables
| 1-Day Chart | Name | Price | Morningstar Rating for Stocks | Capital Allocation | Economic Moat | Market Cap |
|---|---|---|---|---|---|---|
| Coca-Cola Co KO | Fbctzzmj | Qbs | $298.2 Bil | |||
| PepsiCo Inc PEP | Pryqylglx | Gxx | $237.1 Bil | |||
| Monster Beverage Corp MNST | Wrghkbg | Whytgmh | $45.8 Bil | |||
| Nongfu Spring Co Ltd Class H Ordinary Shares NNFSF | — | Zdqg | $42.0 Bil | |||
| Coca-Cola Europacific Partners PLC CCEP | Skhyhlbwc | Wmwkkx | $35.2 Bil | |||
| Coca-Cola Femsa SAB de CV Series L COCSF | — | Hzd | $19.1 Bil | |||
| Coca-Cola Femsa SAB de CV ADR KOF | Nsxrzjmc | Xvrz | $19.1 Bil | |||
| Celsius Holdings Inc CELH | Fqbdsqcc | Btrxj | $9.4 Bil | |||
| Primo Water Corp PRMW | Lbppwmmtn | Bqmbs | $3.5 Bil |
