KEURIG DR PEPPER INC (KDP) Stock Fundamental Analysis
NASDAQ:KDP - Nasdaq - US49271V1008 - Common Stock - Currency: USD
KDP gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 32 industry peers in the Beverages industry. KDP has a medium profitability rating, but doesn't score so well on its financial health evaluation. KDP has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
KDP had positive earnings in the past year.
In the past year KDP had a positive cash flow from operations.
KDP had positive earnings in each of the past 5 years.
In the past 5 years KDP always reported a positive cash flow from operatings.
1.2 Ratios
KDP has a Return On Assets (2.70%) which is in line with its industry peers.
KDP has a Return On Equity of 5.94%. This is comparable to the rest of the industry: KDP outperforms 43.75% of its industry peers.
Looking at the Return On Invested Capital, with a value of 5.58%, KDP is in line with its industry, outperforming 40.63% of the companies in the same industry.
KDP had an Average Return On Invested Capital over the past 3 years of 5.40%. This is significantly below the industry average of 12.12%.
The 3 year average ROIC (5.40%) for KDP is below the current ROIC(5.58%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.7% | ||
| ROE | 5.94% | ||
| ROIC | 5.58% |
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 9.39%, KDP is doing good in the industry, outperforming 65.63% of the companies in the same industry.
In the last couple of years the Profit Margin of KDP has declined.
With a decent Operating Margin value of 22.12%, KDP is doing good in the industry, outperforming 71.88% of the companies in the same industry.
In the last couple of years the Operating Margin of KDP has remained more or less at the same level.
The Gross Margin of KDP (55.56%) is better than 78.13% of its industry peers.
KDP's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.12% | ||
| PM (TTM) | 9.39% | ||
| GM | 55.56% |
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.
The number of shares outstanding for KDP has been reduced compared to 1 year ago.
KDP has less shares outstanding than it did 5 years ago.
KDP has a worse debt/assets ratio than last year.
2.2 Solvency
KDP has an Altman-Z score of 1.52. This is a bad value and indicates that KDP is not financially healthy and even has some risk of bankruptcy.
KDP has a Altman-Z score (1.52) which is in line with its industry peers.
KDP has a debt to FCF ratio of 10.27. This is a negative value and a sign of low solvency as KDP would need 10.27 years to pay back of all of its debts.
KDP has a Debt to FCF ratio (10.27) which is comparable to the rest of the industry.
KDP has a Debt/Equity ratio of 0.63. This is a neutral value indicating KDP is somewhat dependend on debt financing.
With a decent Debt to Equity ratio value of 0.63, KDP is doing good in the industry, outperforming 62.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.63 | ||
| Debt/FCF | 10.27 | ||
| Altman-Z | 1.52 |
ROIC/WACC0.75
WACC7.42%
2.3 Liquidity
A Current Ratio of 0.49 indicates that KDP may have some problems paying its short term obligations.
The Current ratio of KDP (0.49) is worse than 78.13% of its industry peers.
KDP has a Quick Ratio of 0.49. This is a bad value and indicates that KDP is not financially healthy enough and could expect problems in meeting its short term obligations.
KDP's Quick ratio of 0.32 is on the low side compared to the rest of the industry. KDP is outperformed by 71.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.49 | ||
| Quick Ratio | 0.32 |
3. Growth
3.1 Past
KDP shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 7.26%.
KDP shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.49% yearly.
Looking at the last year, KDP shows a small growth in Revenue. The Revenue has grown by 3.62% in the last year.
KDP shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 6.66% yearly.
EPS 1Y (TTM)7.26%
EPS 3Y6.27%
EPS 5Y9.49%
EPS Q2Q%5.45%
Revenue 1Y (TTM)3.62%
Revenue growth 3Y6.57%
Revenue growth 5Y6.66%
Sales Q2Q%5.25%
3.2 Future
Based on estimates for the next years, KDP will show a small growth in Earnings Per Share. The EPS will grow by 3.06% on average per year.
KDP is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.03% yearly.
EPS Next Y6.71%
EPS Next 2Y6.96%
EPS Next 3Y6.94%
EPS Next 5Y3.06%
Revenue Next Year5.44%
Revenue Next 2Y4.72%
Revenue Next 3Y4.44%
Revenue Next 5Y4.03%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
KDP is valuated rather expensively with a Price/Earnings ratio of 18.44.
Based on the Price/Earnings ratio, KDP is valued a bit cheaper than the industry average as 65.63% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of KDP to the average of the S&P500 Index (28.29), we can say KDP is valued slightly cheaper.
With a Price/Forward Earnings ratio of 17.28, KDP is valued on the expensive side.
KDP's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. KDP is cheaper than 78.13% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.08, KDP is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.44 | ||
| Fwd PE | 17.28 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as KDP.
KDP's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.07 | ||
| EV/EBITDA | 15.76 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of KDP may justify a higher PE ratio.
PEG (NY)2.75
PEG (5Y)1.94
EPS Next 2Y6.96%
EPS Next 3Y6.94%
5. Dividend
5.1 Amount
KDP has a Yearly Dividend Yield of 2.65%.
Compared to an average industry Dividend Yield of 3.08, KDP pays a bit more dividend than its industry peers.
KDP's Dividend Yield is comparable with the S&P500 average which is at 2.57.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.65% |
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 82.86% of its income as dividend. This is not a sustainable payout ratio.
KDP's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP82.86%
EPS Next 2Y6.96%
EPS Next 3Y6.94%
35.4
+0.29 (+0.83%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryBeverages
Earnings (Last)
Earnings (Next)
Inst Owners80.71%
Inst Owner Change0%
Ins Owners1.01%
Ins Owner Change-23.94%
Market Cap48.03B
Analysts75
Price Target39.06 (10.34%)
Short Float %2.04%
Short Ratio2.05
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.65% |
Yearly Dividend0.87
Dividend Growth(5Y)7.69%
DP82.86%
Div Incr Years4
Div Non Decr Years5
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.15%
Min EPS beat(2)-0.55%
Max EPS beat(2)0.25%
EPS beat(4)2
Avg EPS beat(4)1.9%
Min EPS beat(4)-0.91%
Max EPS beat(4)8.8%
EPS beat(8)6
Avg EPS beat(8)1.72%
EPS beat(12)6
Avg EPS beat(12)0.81%
EPS beat(16)8
Avg EPS beat(16)0.78%
Revenue beat(2)1
Avg Revenue beat(2)-0.83%
Min Revenue beat(2)-1.89%
Max Revenue beat(2)0.22%
Revenue beat(4)2
Avg Revenue beat(4)-0.42%
Min Revenue beat(4)-1.89%
Max Revenue beat(4)0.78%
Revenue beat(8)4
Avg Revenue beat(8)-0.19%
Revenue beat(12)6
Avg Revenue beat(12)0.18%
Revenue beat(16)10
Avg Revenue beat(16)0.78%
PT rev (1m)0.9%
PT rev (3m)-0.27%
EPS NQ rev (1m)-0.16%
EPS NQ rev (3m)-4.56%
EPS NY rev (1m)-0.1%
EPS NY rev (3m)-0.65%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-3.02%
Revenue NY rev (1m)-0.04%
Revenue NY rev (3m)-0.16%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.44 | ||
| Fwd PE | 17.28 | ||
| P/S | 3.13 | ||
| P/FCF | 30.07 | ||
| P/OCF | 21.64 | ||
| P/B | 1.98 | ||
| P/tB | N/A | ||
| EV/EBITDA | 15.76 |
EPS(TTM)1.92
EY5.42%
EPS(NY)2.05
Fwd EY5.79%
FCF(TTM)1.18
FCFY3.33%
OCF(TTM)1.64
OCFY4.62%
SpS11.31
BVpS17.87
TBVpS-14.33
PEG (NY)2.75
PEG (5Y)1.94
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.7% | ||
| ROE | 5.94% | ||
| ROCE | 7.49% | ||
| ROIC | 5.58% | ||
| ROICexc | 5.64% | ||
| ROICexgc | 93.53% | ||
| OM | 22.12% | ||
| PM (TTM) | 9.39% | ||
| GM | 55.56% | ||
| FCFM | 10.4% |
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-Score7
Asset Turnover0.29
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.63 | ||
| Debt/FCF | 10.27 | ||
| Debt/EBITDA | 3.86 | ||
| Cap/Depr | 112.07% | ||
| Cap/Sales | 4.05% | ||
| Interest Coverage | 6.87 | ||
| Cash Conversion | 56.16% | ||
| Profit Quality | 110.83% | ||
| Current Ratio | 0.49 | ||
| Quick Ratio | 0.32 | ||
| Altman-Z | 1.52 |
F-Score7
WACC7.42%
ROIC/WACC0.75
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)7.26%
EPS 3Y6.27%
EPS 5Y9.49%
EPS Q2Q%5.45%
EPS Next Y6.71%
EPS Next 2Y6.96%
EPS Next 3Y6.94%
EPS Next 5Y3.06%
Revenue 1Y (TTM)3.62%
Revenue growth 3Y6.57%
Revenue growth 5Y6.66%
Sales Q2Q%5.25%
Revenue Next Year5.44%
Revenue Next 2Y4.72%
Revenue Next 3Y4.44%
Revenue Next 5Y4.03%
EBIT growth 1Y6.09%
EBIT growth 3Y2.56%
EBIT growth 5Y7.55%
EBIT Next Year22.01%
EBIT Next 3Y10.4%
EBIT Next 5Y4.61%
FCF growth 1Y88.33%
FCF growth 3Y-12.93%
FCF growth 5Y-5.41%
OCF growth 1Y66.97%
OCF growth 3Y-8.26%
OCF growth 5Y-2.15%