Keurig Dr Pepper is set to report its Q2 2024 results on July 25, with expectations of $3.9 billion in revenue and earnings of $0.45 per share, in line with consensus estimates. The company’s sales growth is expected to be driven by better price realization. The stock has seen a 15% increase in recent years, but has had inconsistent performance, underperforming the S&P 500 in 2021 and 2023. However, the Trefis High Quality Portfolio, consisting of 30 stocks, has consistently outperformed the S&P 500 each year.
Amidst a volatile macroeconomic environment with high oil prices and elevated interest rates, there is uncertainty surrounding KDP’s performance in the next 12 months. From a valuation perspective, the stock appears to have room for growth, with an estimated valuation of $38 per share, indicating a potential 15% upside. Looking back at Q1, Keurig Dr Pepper reported a 3.4% y-o-y increase in revenue, with growth in the U.S. Refreshment Beverages and International segments offsetting a decline in the U.S. Coffee segment.
For the upcoming quarter, KDP is expected to see around 3% y-o-y top-line growth, benefiting from price realization and international expansion. However, sales in the U.S. Coffee segment may decrease. The company has been improving its margins and focusing on reviving coffee sales in the U.S., which could positively impact its stock performance. Overall, an in-line Q2 is anticipated for Keurig Dr Pepper, with stock movement dependent on its margin profile.
While KDP stock shows potential for growth, it is important to consider how its peers are performing on key metrics. Peer comparisons can provide valuable insights into the competitive landscape. Investors can explore Trefis Market-Beating Portfolios for investment opportunities and see price estimates for various companies.
