Opinions
Stephanie Link, Chief investment strategist, Hightower
Keurig Dr Pepper
KDP-Q
BUY
Sep 11, 2023
$33.540
Stock price when the opinion was issued
breweries
beverages
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BUY
KDP was a merger of Keurig and Dr. Pepper. Today, they announced mid-single-digit sales growth and high-single-digit earnings growth with $4 billion in discretionary cash flow over the next three years. They want to reward shareholders with special dividends and/or share buybacks or an acquisition. It's a safety stock that knows how to grow.
breweries
beverages
Sold it to buy Amazon but still likes KDP, which has a better long-term story than Pepsi or Coke, which trades around 23x forward PE (KDP is 19x). Likes KDP's 5% volume growth and M&A.