Keurig Dr Pepper (KDP) has been identified by UBS as a top stock pick. With a market cap of $43.9 billion and a price target of $42, there is a potential upside of 29.7%. UBS highlights the resilience of KDP in a challenging market, noting that both top- and bottom-line visibility remain strong.
The coffee segment is expected to drive organic sales growth, thanks to strategic partnerships and the introduction of new products like Ghost. Despite a subdued outlook for the at-home coffee category, KDP is projected to meet its long-term targets and is trading at a 25% discount to peers. This positioning suggests that KDP is well-equipped to navigate the current economic landscape, making it an attractive investment opportunity as 2025 approaches.
Estimates for the fourth quarter and 2025 appear stable. The coffee segment is expected to drive organic sales growth, thanks to strategic partnerships and the introduction of new products like Ghost. Despite a subdued outlook for the at-home coffee category, KDP is projected to meet its long-term targets and is trading at a 25% discount to peers.