Keurig Dr Pepper (KDP)
Consumer · NASDAQ · US
Fundamentals
Valuation and ratings
Keurig Dr Pepper trades at $30.28, which is 39% above the $18.57 our discounted cash flow model puts on the business. On that measure it screens as expensive, which is not the same as saying it will fall.
Our moat model scores it 58 out of 100, which is a moat, but not a deep one. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 23.5 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About Keurig Dr Pepper
Keurig Dr Pepper Inc. owns, manufactures, and distributors beverages and single serve brewing systems in the United States and internationally. The company operates through three segments: U.S. Refreshment Beverages, U.S. Coffee, and International. It manufactures and distributes branded concentrates, syrup, and finished beverages, as well as sales of owned brands and third-party brands; tea, cocoa, and other products; and offers finished goods relating to K-Cup pods, single serve brewers, specialty coffee, and ready to drink coffee products. The company offers its products under the Dr Pepper, Canada Dry, Mott's, A&W, Peñafiel, GHOST, Snapple, 7UP, Green Mountain Coffee Roasters, Clamato, Core Hydration, The Original Donut Shop, Sunkist soda, Squirt, C4 Energy, Hawaiian Punch, Electrolit, Bloom, Bai, Evian, Yoo-Hoo, Vita Coco, Big Red, RC Cola, Crush, McCafé, Tim Hortons, Van Houtte, Celestial Seasonings, Bigelow, Starbucks, Dunkin', Folgers, Peet's, and Swiss Miss brands, as well as other partner and private label brands. It markets and sells its products to supermarkets, mass merchandisers, club stores, e-commerce retailers, office superstores, vending machines, fountains, grocery and drug stores, convenience stores, and other small outlets; and directly to consumers through Keurig.com website. Keurig Dr Pepper Inc. was founded in 1981 and is headquartered in Frisco, Texas.
KDP passes 4 of our 30 screens today
Each screen prints the exact criteria it used, and the circumstances in which it is wrong.
Smart money ownership
15 of the funds we track reported a position in their latest SEC 13F filing. Largest first:
- Bill Nygren, HARRIS ASSOCIATES L P$4.90B · 3.4% of book
- Cliff Asness, AQR CAPITAL MANAGEMENT LLC$124.66M · 0.1% of book
- Contrarius Group, Contrarius Group Holdings Ltd$73.41M · 4.2% of book
- Ken Griffin, CITADEL ADVISORS LLC$47.31M · 0.0% of book
- Joel Greenblatt, Gotham Asset Management, LLC$26.05M · 0.1% of book
A word of warning on reading these figures: a 13F reports the market value of a holding, so a fund that traded nothing at all still appears to have sold when the price fell. We found 102 companies where the standard reading gives the opposite answer. Only the share count is honest.
Common questions
Is Keurig Dr Pepper (KDP) undervalued?
Against our discounted cash flow estimate of $18.57, KDP at $30.28 is 39% above fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
Which funds own KDP?
15 of the institutions we track reported a position in KDP in their most recent SEC 13F filing. A 13F is filed up to 45 days after quarter end, so it tells you what a fund held then, not what it holds now.
What is KDP's P/E ratio?
KDP trades at 23.5 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
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Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.