Keurig Dr Pepper: Strong Growth Potential and Undervalued Stock with Strategic Expansion

Analyst Christopher Carey of Wells Fargo maintained a Buy rating on Keurig Dr Pepper (KDP – Research Report), retaining the price target of $40.00.

Christopher Carey has given his Buy rating due to a combination of factors that highlight Keurig Dr Pepper’s strong performance and growth potential. The company’s management has reiterated its guidance for 2025, emphasizing a solid long-term strategy and a positive outlook for the second quarter. This confidence is supported by the company’s ability to deliver high single-digit EPS growth, which is seen as undervalued at the current stock price.
Furthermore, Carey notes that Keurig Dr Pepper’s strategy is anchored by five pillars, including a focus on consumer-centric brands, expansion into new verticals like energy and sports hydration, and a robust distribution network. The company’s commitment to sustainable and predictable total shareholder returns, along with effective capital allocation, positions it well for continued growth. Despite challenges such as inflation in aluminum costs, the company’s historical performance and future potential make it an attractive investment opportunity.

Carey covers the Consumer Defensive sector, focusing on stocks such as Church & Dwight, Clorox, and Keurig Dr Pepper. According to TipRanks, Carey has an average return of 0.2% and a 46.32% success rate on recommended stocks.

In another report released on June 20, Morgan Stanley also reiterated a Buy rating on the stock with a $40.00 price target.