PEP - Keurig Dr Pepper: Upside Plenty Of Potential Left

2024-05-28 08:21:53 ET

Summary

• Keurig Dr Pepper (KDP) has shown decent performance since the last article, with net sales rising well beyond expectations and significant gross margin expansion.
• KDP remains undervalued with potential for growth, particularly in the coffee sector, despite challenges in the competitive coffee market.
• The company expects sales growth, recovery in operating income, and an increase in company EPS for the fiscal year 2024, which could lead to a higher share price.

Dear readers/followers,

You may recall my last article on Keurig Dr Pepper ( KDP ), an article which you can find here. In that piece, I retained my positive rating on the company, called it a "BUY" and even bought a few more shares in connection with this. As you can see, the company managed a decent performance since that time.

In this article, I'll provide an update for KDP and see where the company could go from here. I own a number of beverage businesses In my portfolio, and honestly, many of them have substantially outperformed. The most recent example of this I consider worth mentioning is Coca-Cola Consolidated ( COKE ), where I have managed to "score" a triple-digit TSR over what I consider a relatively short period of time....

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