Keurig’s (KDP) K-cups are fully recyclable today. That, however, was not always the case. And when Keurig originally made claims to investors that recycling would be simple, the Securities and Exchange Commission (SEC) looked into the matter more directly. A settlement followed, and that led to a fractional loss for Keurig Dr. Pepper in Tuesday afternoon’s trading.
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While Keurig asserted that the cups were recyclable, the SEC took issue with that, calling the claims “inaccurate.” Ultimately, Keurig and the SEC reached a mutually amicable conclusion that they basically would not talk about it anymore, and Keurig would cut a check for $1.5 million payable to the SEC. In exchange, Keurig would not have to admit to or deny any of the SEC’s findings on the matter.
A matter of timing also became an issue. In 2018, a class action lawsuit arose about K-cup recycling. This led to a $10 million settlement paid by Keurig. By 2020’s end, K-cups were, indeed, fully recyclable, according to Keurig. However, prior to 2020, Keurig was telling its investors that the cups were recyclable. This was despite two of the largest recycling firms in the U.S. telling Keurig they would refuse K-cups over issues of financial viability.
Adding a New Brand
In a separate development, Keurig added a new line of beverages just days ago for availability in late 2024/early 2025. Black Rifle Coffee will be joining the line of Keurig beverages, though no one was talking about the exact terms.
Keurig already offered some Black Rifle beverages, but now it will add Black Rifle Energy to its lineup. Four flavors will be available, and none of them feature sugar. But each offers a whopping 200 milligrams of caffeine per 16-ounce can. Given that just two years ago, Keurig dropped $863 million for a piece of C4 Energy, and put some cash into A Shoc’s funding, Keurig has a clear interest in getting in on the energy drink market.
Is Keurig Dr. Pepper Stock a Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on KDP stock based on six Buys and five Holds assigned in the past three months, as indicated by the graphic below. After a 13.65% rally in its share price over the past year, the average KDP price target of $37.88 per share implies 2.05% upside potential.
