KEURIG DR PEPPER INC (KDP)

US49271V1008 - Common Stock

30.67  +0.08 (+0.26%)

After market: 30.67 0 (0%)

Fundamental Rating

4

KDP gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 33 industry peers in the Beverages industry. While KDP is still in line with the averages on profitability rating, there are concerns on its financial health. KDP has a correct valuation and a medium growth rate.



6

1. Profitability

1.1 Basic Checks

In the past year KDP was profitable.
In the past year KDP had a positive cash flow from operations.
KDP had positive earnings in each of the past 5 years.
KDP had a positive operating cash flow in each of the past 5 years.

1.2 Ratios

KDP has a Return On Assets of 4.18%. This is in the lower half of the industry: KDP underperforms 63.64% of its industry peers.
KDP's Return On Equity of 8.49% is on the low side compared to the rest of the industry. KDP is outperformed by 60.61% of its industry peers.
KDP has a Return On Invested Capital of 5.74%. This is in the lower half of the industry: KDP underperforms 63.64% of its industry peers.
KDP had an Average Return On Invested Capital over the past 3 years of 5.66%. This is significantly below the industry average of 12.38%.
The last Return On Invested Capital (5.74%) for KDP is above the 3 year average (5.66%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 4.18%
ROE 8.49%
ROIC 5.74%
ROA(3y)3.73%
ROA(5y)3.28%
ROE(3y)7.6%
ROE(5y)6.75%
ROIC(3y)5.66%
ROIC(5y)5.4%

1.3 Margins

KDP's Profit Margin of 14.72% is fine compared to the rest of the industry. KDP outperforms 75.76% of its industry peers.
KDP's Profit Margin has improved in the last couple of years.
The Operating Margin of KDP (21.61%) is better than 72.73% of its industry peers.
In the last couple of years the Operating Margin of KDP has grown nicely.
KDP has a Gross Margin of 54.54%. This is in the better half of the industry: KDP outperforms 75.76% of its industry peers.
KDP's Gross Margin has been stable in the last couple of years.
Industry RankSector Rank
OM 21.61%
PM (TTM) 14.72%
GM 54.54%
OM growth 3Y-5.34%
OM growth 5Y5%
PM growth 3Y8.88%
PM growth 5Y13.33%
GM growth 3Y-1.04%
GM growth 5Y0.9%

2

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), KDP is destroying value.
KDP has less shares outstanding than it did 1 year ago.
The number of shares outstanding for KDP has been reduced compared to 5 years ago.
KDP has a worse debt/assets ratio than last year.

2.2 Solvency

Based on the Altman-Z score of 1.44, we must say that KDP is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.44, KDP is doing worse than 69.70% of the companies in the same industry.
The Debt to FCF ratio of KDP is 16.55, which is on the high side as it means it would take KDP, 16.55 years of fcf income to pay off all of its debts.
KDP's Debt to FCF ratio of 16.55 is on the low side compared to the rest of the industry. KDP is outperformed by 72.73% of its industry peers.
A Debt/Equity ratio of 0.50 indicates that KDP is not too dependend on debt financing.
KDP has a Debt to Equity ratio of 0.50. This is comparable to the rest of the industry: KDP outperforms 54.55% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.5
Debt/FCF 16.55
Altman-Z 1.44
ROIC/WACC0.78
WACC7.36%

2.3 Liquidity

A Current Ratio of 0.38 indicates that KDP may have some problems paying its short term obligations.
KDP's Current ratio of 0.38 is on the low side compared to the rest of the industry. KDP is outperformed by 96.97% of its industry peers.
KDP has a Quick Ratio of 0.38. This is a bad value and indicates that KDP is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.24, KDP is not doing good in the industry: 93.94% of the companies in the same industry are doing better.
Industry RankSector Rank
Current Ratio 0.38
Quick Ratio 0.24

4

3. Growth

3.1 Past

KDP shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 6.55%.
Measured over the past years, KDP shows a decrease in Earnings Per Share. The EPS has been decreasing by -9.07% on average per year.
Looking at the last year, KDP shows a small growth in Revenue. The Revenue has grown by 5.39% in the last year.
Measured over the past years, KDP shows a quite strong growth in Revenue. The Revenue has been growing by 14.76% on average per year.
EPS 1Y (TTM)6.55%
EPS 3Y8.54%
EPS 5Y-9.07%
EPS growth Q2Q10%
Revenue 1Y (TTM)5.39%
Revenue growth 3Y8.44%
Revenue growth 5Y14.76%
Revenue growth Q2Q1.68%

3.2 Future

KDP is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.12% yearly.
Based on estimates for the next years, KDP will show a small growth in Revenue. The Revenue will grow by 3.67% on average per year.
EPS Next Y7.56%
EPS Next 2Y7.52%
EPS Next 3Y7.34%
EPS Next 5Y7.12%
Revenue Next Year3.49%
Revenue Next 2Y3.62%
Revenue Next 3Y3.57%
Revenue Next 5Y3.67%

3.3 Evolution

The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.

4

4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 17.13 indicates a rather expensive valuation of KDP.
Based on the Price/Earnings ratio, KDP is valued cheaper than 81.82% of the companies in the same industry.
When comparing the Price/Earnings ratio of KDP to the average of the S&P500 Index (26.48), we can say KDP is valued slightly cheaper.
A Price/Forward Earnings ratio of 15.93 indicates a correct valuation of KDP.
75.76% of the companies in the same industry are more expensive than KDP, based on the Price/Forward Earnings ratio.
KDP's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 22.79.
Industry RankSector Rank
PE 17.13
Fwd PE 15.93

4.2 Price Multiples

KDP's Enterprise Value to EBITDA is on the same level as the industry average.
KDP's Price/Free Cash Flow ratio is in line with the industry average.
Industry RankSector Rank
P/FCF 50.19
EV/EBITDA 14.44

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
KDP has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.27
PEG (5Y)N/A
EPS Next 2Y7.52%
EPS Next 3Y7.34%

6

5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 2.91%, KDP has a reasonable but not impressive dividend return.
KDP's Dividend Yield is rather good when compared to the industry average which is at 2.45. KDP pays more dividend than 84.85% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.34, KDP pays a bit more dividend than the S&P500 average.
Industry RankSector Rank
Dividend Yield 2.91%

5.2 History

On average, the dividend of KDP grows each year by 22.77%, which is quite nice.
KDP has paid a dividend for at least 10 years, which is a reliable track record.
KDP has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)22.77%
Div Incr Years3
Div Non Decr Years4

5.3 Sustainability

KDP pays out 52.36% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of KDP is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP52.36%
EPS Next 2Y7.52%
EPS Next 3Y7.34%

KEURIG DR PEPPER INC

NASDAQ:KDP (3/28/2024, 8:20:31 PM)

After market: 30.67 0 (0%)

30.67

+0.08 (+0.26%)

Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryBeverages
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap42.56B
Analysts
Price Target
Dividend
Industry RankSector Rank
Dividend Yield 2.91%
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
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EPS beat(8)
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EPS beat(16)
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Revenue beat(2)
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Revenue beat(4)
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Revenue beat(8)
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Revenue beat(12)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
Industry RankSector Rank
PE 17.13
Fwd PE 15.93
P/S
P/FCF
P/OCF
P/B
P/tB
EV/EBITDA
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)2.27
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 4.18%
ROE 8.49%
ROCE
ROIC
ROICexc
ROICexgc
OM 21.61%
PM (TTM) 14.72%
GM 54.54%
FCFM
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.28
Health
Industry RankSector Rank
Debt/Equity 0.5
Debt/FCF
Debt/EBITDA
Cap/Depr
Cap/Sales
Interest Coverage
Cash Conversion
Profit Quality
Current Ratio 0.38
Quick Ratio 0.24
Altman-Z
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)6.55%
EPS 3Y8.54%
EPS 5Y
EPS growth Q2Q
EPS Next Y7.56%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)5.39%
Revenue growth 3Y8.44%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y