Deutsche Bank Upgrades Pepsi Bottling Group (PBG) and Dr Pepper Snapple Group (DPS) to Buy

April 2, 2009 8:21 AM EDT

Deutsche Bank upgrades Pepsi Bottling Group (NYSE: PBG) ($28 target, benefits from more aggressive
investment by Pepsi (NYSE: PEP)) and Dr Pepper Snapple Group (NYSE: DPS) ($22, continues outperforming CSD category and remains mis-valued) from Hold to Buy.

Deutsche analyst says, "More positive outlook for 2009 - For the past two years our primary concern for domestic soft drinks has been higher pricing in the name of margin protection, without regard for declining volume or consumer relevancy. Although the going is still early, our conversations with category managers indicate increasing promotional investment in the category. We are taking a more constructive view, as this strategic shift should help stabilize volume heading into peak summer season, with commodity deflation insulating margins."

Deutsche Bank also raises Price Target for Coca-Cola Enterprises (NYSE: CCE) from $13 to $16, but
remain at Hold.

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