Keurig Dr Pepper (KDP) AI Stock Analysis

• Market Cap: $45.87B
• Dividend Yield: 2.68%
• Average Volume (3M): 17.21M
• Price to Earnings (P/E): 32.1
• Beta (1Y): 0.18
• Revenue Growth: 3.62%
• EPS Growth: -32.23%
• Country: US
• Employees: 29,400
• Sector: Consumer Defensive
• Sector Strength: 94
• Industry: Beverages - Non-Alcoholic
• EPS (TTM): 1.05
• Shares Outstanding: 1,356,750,900
• 10 Day Avg. Volume: 15,632,863
• 30 Day Avg. Volume: 17,208,252
• PEG Ratio: 1.02
• Price to Book (P/B): N/A
• Price to Sales (P/S): 2.97
• Price to Cash Flow (P/CF): 13.40
• P/FCF Ratio: 10.10
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $38.00
• Price Target Upside: 12.39% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

Keurig Dr Pepper's overall stock score reflects its robust financial performance and positive market momentum. The company's strong guidance and strategic initiatives, including the new credit agreement, bolster its outlook. However, the high P/E ratio suggests that the stock might be overvalued, and challenges in specific segments could pose risks.

Positive Factors

Corporate Performance

KDP's corporate strength is highlighted by its substantial outperformance in Q1 US scanner data compared to large-cap peers.

Growth Prospects

KDP's growth is seen as durable, with its expected profit mix shifting towards more profitable segments.

Stock Rating

An analyst recommends upgrading the stock rating to Overweight.

Negative Factors

Coffee Business Uncertainty

The near-term path of the coffee business has some uncertainty, with the lag of pricing to inflation and no clean read yet on elasticity.

Coffee Segment

There is a short-term coffee profit downside risk.

Share Transition

The transition of shares from private to public has been a long and painful process, weighing on the stock over the years.

Keurig Dr Pepper Business Overview & Revenue Model

Company Description

Keurig Dr Pepper (KDP) is a leading beverage company in North America, operating in the consumer goods sector. It offers a diverse portfolio of soft drinks, specialty coffee, tea, water, juice, and other beverages. The company is renowned for its flagship brands such as Dr Pepper, Snapple, Green Mountain Coffee Roasters, and Keurig single-serve brewing systems. KDP's operations span the manufacturing, marketing, and distribution of its extensive beverage lineup, catering to a wide range of consumer preferences.

How the Company Makes Money

Keurig Dr Pepper generates revenue through multiple streams, primarily from the sale of its beverages and coffee systems. The company earns money by selling packaged beverages, including carbonated soft drinks, ready-to-drink teas, and bottled water, to retailers and distributors. In addition, KDP profits from its Keurig brewing systems and the sale of K-Cup pods, which are compatible with its coffee machines. The company also benefits from strategic partnerships and licensing agreements that expand its brand reach and product offerings. Key factors contributing to KDP's earnings include a robust distribution network, a diverse product portfolio, and a strong presence in both the retail and away-from-home markets.

Keurig Dr Pepper Financial Statement Overview

Summary

Keurig Dr Pepper shows solid financial performance with consistent revenue growth and strong cash flow management. However, a decrease in net profit margin and return on equity indicates areas for improvement, and the high debt-to-equity ratio requires careful monitoring.

Income Statement

Keurig Dr Pepper has demonstrated solid revenue growth, with a 3.62% increase from 2023 to 2024. The gross profit margin is healthy at 55.57%, indicating efficient production processes. However, the net profit margin has decreased to 9.39%, suggesting rising costs or operational inefficiencies. The EBIT and EBITDA margins are stable, reflecting consistent operating performance.

Balance Sheet

The company maintains a strong equity base, with an equity ratio of 45.38%, indicative of financial stability. However, the debt-to-equity ratio is relatively high at 0.64, which could pose risks if interest rates rise. The return on equity has decreased to 5.94%, which may concern investors seeking higher returns.

Cash Flow

Keurig Dr Pepper has shown robust free cash flow growth of 95.10%, reflecting improved cash generation capabilities. The operating cash flow to net income ratio is 1.54, indicating strong cash conversion. Additionally, the free cash flow to net income ratio of 1.15 suggests effective cash management, although there is room for improvement in capital efficiency.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
15.35B	14.81B	14.06B	12.68B	11.62B
	Gross Profit
8.53B	8.08B	7.32B	6.98B	6.49B
	EBIT
2.59B	3.19B	2.60B	2.89B	2.48B
	EBITDA
3.38B	3.97B	3.58B	3.74B	2.85B
	Net Income Common Stockholders
1.44B	2.18B	1.44B	2.15B	1.32B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
510.00M	267.00M	535.00M	567.00M	240.00M
	Total Assets
53.43B	52.13B	51.84B	50.60B	49.78B
	Total Debt
17.27B	14.82B	11.97B	11.88B	13.49B
	Net Debt
16.76B	14.56B	11.43B	11.31B	13.25B
	Total Liabilities
29.19B	26.45B	26.71B	25.63B	25.95B
	Stockholders Equity
24.24B	25.68B	25.13B	24.97B	23.83B
Cash Flow		Free Cash Flow
1.66B	848.00M	2.46B	2.42B	1.94B
	Operating Cash Flow
2.22B	1.33B	2.84B	2.87B	2.46B
	Investing Cash Flow
-1.61B	-784.00M	-1.14B	210.00M	-316.00M
	Financing Cash Flow
-223.00M	-832.00M	-1.73B	-2.76B	-1.99B

Keurig Dr Pepper Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 33.81
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KDP, the sentiment is Positive. The current price of 33.81 is above the 20-day moving average (MA) of 33.68, above the 50-day MA of 32.85, and above the 200-day MA of 33.42, indicating a bullish trend. The MACD of 0.43 indicates Negative momentum. The RSI at 67.67 is Neutral, neither overbought nor oversold. The STOCH value of 76.63 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KDP.

Keurig Dr Pepper Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CCEP	79 Outperform	$38.67B	25.17	17.43%	2.54%	11.73%	-15.34%
PEP	77 Outperform	$201.05B	21.09	52.42%	3.70%	0.42%	5.77%
KDP	76 Outperform	$45.87B	32.11	5.77%	2.68%	3.62%	-32.23%
MNST	76 Outperform	$55.55B	38.47	21.27%	―	4.94%	-4.13%
COKE	74 Outperform	$11.39B	20.78	44.38%	0.46%	3.69%	60.51%
KO	73 Outperform	$300.95B	28.42	41.86%	2.81%	1.96%	-0.45%
Sector *	62 Neutral	$20.22B	13.99	-16.14%	3.22%	1.15%	3.41%

Keurig Dr Pepper Corporate Events

Keurig Dr Pepper Secures New $4 Billion Credit Agreement

On March 31, 2025, Keurig Dr Pepper Inc. entered into a new $4 billion unsecured revolving credit agreement with JPMorgan Chase Bank, which will mature on March 31, 2030. This agreement, replacing a previous one from February 2022, is intended for general corporate purposes and working capital, potentially enhancing the company’s financial flexibility and operational capacity.

Keurig Dr Pepper Board Restructuring Amid Stockholder Sale

On February 28, 2025, Keurig Dr Pepper Inc. experienced significant changes in its board of directors as three members affiliated with JAB BevCo B.V. resigned, reducing the board size from eleven to eight. This coincided with the completion of a public secondary offering by the Selling Stockholder, resulting in gross proceeds of approximately $2.7 billion, although the company did not receive any proceeds from this sale.

Keurig Dr Pepper Executive Resigns, Transition Planned

Andrew Archambault, President of U.S. Refreshment Beverages at Keurig Dr Pepper, has resigned effective January 13, 2025, and will assist in the transition until his departure on January 31, 2025. His resignation could potentially impact the company’s operations, as he is a named executive officer, but the company aims for a smooth transition to his successor.