KEURIG DR PEPPER INC (KDP) Stock Fundamental Analysis
USA - NASDAQ:KDP - US49271V1008 - Common Stock
27.23 USD
-0.36 (-1.3%)
27.33 USD
+0.1 (+0.37%)
We assign a fundamental rating of 4 out of 10 to KDP. KDP was compared to 32 industry peers in the Beverages industry. There are concerns on the financial health of KDP while its profitability can be described as average. KDP has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year KDP was profitable.
KDP had a positive operating cash flow in the past year.
Each year in the past 5 years KDP has been profitable.
In the past 5 years KDP always reported a positive cash flow from operatings.
1.2 Ratios
With a Return On Assets value of 2.83%, KDP perfoms like the industry average, outperforming 43.75% of the companies in the same industry.
KDP has a Return On Equity of 6.15%. This is comparable to the rest of the industry: KDP outperforms 40.63% of its industry peers.
With a Return On Invested Capital value of 5.48%, KDP is not doing good in the industry: 62.50% of the companies in the same industry are doing better.
Measured over the past 3 years, the Average Return On Invested Capital for KDP is significantly below the industry average of 11.08%.
The last Return On Invested Capital (5.48%) for KDP is above the 3 year average (5.40%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.83% | ||
| ROE | 6.15% | ||
| ROIC | 5.48% |
ROA(3y)3.22%
ROA(5y)3.31%
ROE(3y)6.72%
ROE(5y)6.86%
ROIC(3y)5.4%
ROIC(5y)5.42%
1.3 Margins
With a decent Profit Margin value of 9.75%, KDP is doing good in the industry, outperforming 71.88% of the companies in the same industry.
KDP's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 21.90%, KDP is in the better half of the industry, outperforming 78.13% of the companies in the same industry.
KDP's Operating Margin has been stable in the last couple of years.
KDP has a Gross Margin of 54.93%. This is in the better half of the industry: KDP outperforms 68.75% of its industry peers.
KDP's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 21.9% | ||
| PM (TTM) | 9.75% | ||
| GM | 54.93% |
OM growth 3Y-3.77%
OM growth 5Y0.83%
PM growth 3Y-17.83%
PM growth 5Y-3.6%
GM growth 3Y0.21%
GM growth 5Y-0.52%
2. Health
2.1 Basic Checks
KDP has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it 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.
The debt/assets ratio for KDP is higher compared to a year ago.
2.2 Solvency
KDP has an Altman-Z score of 1.34. This is a bad value and indicates that KDP is not financially healthy and even has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.34, KDP is doing worse than 62.50% of the companies in the same industry.
KDP has a debt to FCF ratio of 10.64. This is a negative value and a sign of low solvency as KDP would need 10.64 years to pay back of all of its debts.
With a Debt to FCF ratio value of 10.64, KDP perfoms like the industry average, outperforming 46.88% of the companies in the same industry.
KDP has a Debt/Equity ratio of 0.64. This is a neutral value indicating KDP is somewhat dependend on debt financing.
The Debt to Equity ratio of KDP (0.64) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.64 | ||
| Debt/FCF | 10.64 | ||
| Altman-Z | 1.34 |
ROIC/WACC0.79
WACC6.9%
2.3 Liquidity
A Current Ratio of 0.64 indicates that KDP may have some problems paying its short term obligations.
With a Current ratio value of 0.64, KDP is not doing good in the industry: 84.38% of the companies in the same industry are doing better.
A Quick Ratio of 0.38 indicates that KDP may have some problems paying its short term obligations.
With a Quick ratio value of 0.38, KDP is not doing good in the industry: 81.25% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.64 | ||
| Quick Ratio | 0.38 |
3. Growth
3.1 Past
KDP shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 7.53%.
Measured over the past years, KDP shows a quite strong growth in Earnings Per Share. The EPS has been growing by 9.49% on average per year.
KDP shows a small growth in Revenue. In the last year, the Revenue has grown by 4.63%.
The Revenue has been growing slightly by 6.66% on average over the past years.
EPS 1Y (TTM)7.53%
EPS 3Y6.27%
EPS 5Y9.49%
EPS Q2Q%8.89%
Revenue 1Y (TTM)4.63%
Revenue growth 3Y6.57%
Revenue growth 5Y6.66%
Sales Q2Q%6.14%
3.2 Future
KDP is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 4.24% yearly.
KDP is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.12% yearly.
EPS Next Y7.64%
EPS Next 2Y7.04%
EPS Next 3Y6.96%
EPS Next 5Y4.24%
Revenue Next Year6.28%
Revenue Next 2Y5.23%
Revenue Next 3Y4.77%
Revenue Next 5Y5.12%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less 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. Valuation
4.1 Price/Earnings Ratio
KDP is valuated correctly with a Price/Earnings ratio of 13.62.
84.38% of the companies in the same industry are more expensive than KDP, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 27.30, KDP is valued rather cheaply.
The Price/Forward Earnings ratio is 12.38, which indicates a correct valuation of KDP.
Compared to the rest of the industry, the Price/Forward Earnings ratio of KDP indicates a rather cheap valuation: KDP is cheaper than 81.25% of the companies listed in the same industry.
KDP's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 22.73.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.62 | ||
| Fwd PE | 12.38 |
4.2 Price Multiples
KDP's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, KDP is valued a bit cheaper than the industry average as 62.50% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.49 | ||
| EV/EBITDA | 13 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.78
PEG (5Y)1.43
EPS Next 2Y7.04%
EPS Next 3Y6.96%
5. Dividend
5.1 Amount
KDP has a Yearly Dividend Yield of 3.33%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.83, KDP pays a bit more dividend than its industry peers.
KDP's Dividend Yield is a higher than the S&P500 average which is at 2.41.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.33% |
5.2 History
On average, the dividend of KDP grows each year by 7.69%, which is quite nice.
KDP has been paying a dividend for at least 10 years, so it has a reliable track record.
KDP has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)7.69%
Div Incr Years4
Div Non Decr Years5
5.3 Sustainability
KDP pays out 79.95% of its income as dividend. This is not a sustainable payout ratio.
The dividend of KDP is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP79.95%
EPS Next 2Y7.04%
EPS Next 3Y6.96%
27.23
-0.36 (-1.3%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryBeverages
Earnings (Last)
Earnings (Next)
Inst Owners87.64%
Inst Owner Change7.41%
Ins Owners0.65%
Ins Owner Change-0.4%
Market Cap36.99B
Analysts76.8
Price Target38.5 (41.39%)
Short Float %2.7%
Short Ratio2.79
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.33% |
Yearly Dividend0.87
Dividend Growth(5Y)7.69%
DP79.95%
Div Incr Years4
Div Non Decr Years5
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)4.27%
Min EPS beat(2)-0.22%
Max EPS beat(2)8.75%
EPS beat(4)2
Avg EPS beat(4)2.06%
Min EPS beat(4)-0.55%
Max EPS beat(4)8.75%
EPS beat(8)5
Avg EPS beat(8)2.3%
EPS beat(12)7
Avg EPS beat(12)1.66%
EPS beat(16)7
Avg EPS beat(16)1%
Revenue beat(2)1
Avg Revenue beat(2)0.25%
Min Revenue beat(2)-0.36%
Max Revenue beat(2)0.86%
Revenue beat(4)2
Avg Revenue beat(4)-0.29%
Min Revenue beat(4)-1.89%
Max Revenue beat(4)0.86%
Revenue beat(8)3
Avg Revenue beat(8)-0.42%
Revenue beat(12)5
Avg Revenue beat(12)-0.23%
Revenue beat(16)9
Avg Revenue beat(16)0.37%
PT rev (1m)-2.99%
PT rev (3m)-3.39%
EPS NQ rev (1m)-0.04%
EPS NQ rev (3m)-1.07%
EPS NY rev (1m)0.35%
EPS NY rev (3m)0.41%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.99%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)0.48%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.62 | ||
| Fwd PE | 12.38 | ||
| P/S | 2.35 | ||
| P/FCF | 23.49 | ||
| P/OCF | 17.47 | ||
| P/B | 1.48 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13 |
EPS(TTM)2
EY7.34%
EPS(NY)2.2
Fwd EY8.08%
FCF(TTM)1.16
FCFY4.26%
OCF(TTM)1.56
OCFY5.72%
SpS11.6
BVpS18.39
TBVpS-14.05
PEG (NY)1.78
PEG (5Y)1.43
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.83% | ||
| ROE | 6.15% | ||
| ROCE | 7.32% | ||
| ROIC | 5.48% | ||
| ROICexc | 5.53% | ||
| ROICexgc | 65.34% | ||
| OM | 21.9% | ||
| PM (TTM) | 9.75% | ||
| GM | 54.93% | ||
| FCFM | 9.99% |
ROA(3y)3.22%
ROA(5y)3.31%
ROE(3y)6.72%
ROE(5y)6.86%
ROIC(3y)5.4%
ROIC(5y)5.42%
ROICexc(3y)5.46%
ROICexc(5y)5.47%
ROICexgc(3y)231.8%
ROICexgc(5y)N/A
ROCE(3y)7.24%
ROCE(5y)7.17%
ROICexcg growth 3YN/A
ROICexcg growth 5Y-33.84%
ROICexc growth 3Y0.57%
ROICexc growth 5Y6.63%
OM growth 3Y-3.77%
OM growth 5Y0.83%
PM growth 3Y-17.83%
PM growth 5Y-3.6%
GM growth 3Y0.21%
GM growth 5Y-0.52%
F-Score6
Asset Turnover0.29
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.64 | ||
| Debt/FCF | 10.64 | ||
| Debt/EBITDA | 4.01 | ||
| Cap/Depr | 95.76% | ||
| Cap/Sales | 3.44% | ||
| Interest Coverage | 6.16 | ||
| Cash Conversion | 52.7% | ||
| Profit Quality | 102.54% | ||
| Current Ratio | 0.64 | ||
| Quick Ratio | 0.38 | ||
| Altman-Z | 1.34 |
F-Score6
WACC6.9%
ROIC/WACC0.79
Cap/Depr(3y)90.63%
Cap/Depr(5y)91.99%
Cap/Sales(3y)3.33%
Cap/Sales(5y)3.61%
Profit Quality(3y)106.96%
Profit Quality(5y)115.99%
High Growth Momentum
Growth
EPS 1Y (TTM)7.53%
EPS 3Y6.27%
EPS 5Y9.49%
EPS Q2Q%8.89%
EPS Next Y7.64%
EPS Next 2Y7.04%
EPS Next 3Y6.96%
EPS Next 5Y4.24%
Revenue 1Y (TTM)4.63%
Revenue growth 3Y6.57%
Revenue growth 5Y6.66%
Sales Q2Q%6.14%
Revenue Next Year6.28%
Revenue Next 2Y5.23%
Revenue Next 3Y4.77%
Revenue Next 5Y5.12%
EBIT growth 1Y-1.51%
EBIT growth 3Y2.56%
EBIT growth 5Y7.55%
EBIT Next Year21.61%
EBIT Next 3Y10.21%
EBIT Next 5Y8.67%
FCF growth 1Y0.77%
FCF growth 3Y-12.93%
FCF growth 5Y-5.41%
OCF growth 1Y8.56%
OCF growth 3Y-8.26%
OCF growth 5Y-2.15%