UBS Reiterates Buy Rating on Keurig Dr Pepper (KDP) on Favorable Risk/Reward Given Recent Pullback

UBS analyst Peter Grom reiterated a Buy rating and $32.00 price target on Keurig Dr Pepper (NASDAQ: KDP).

The analyst commented, "KDP is scheduled to report 1Q EPS on Thursday (4/23) before the open. Heading into the print, we do not expect any major surprises with the company likely delivering an in-line quarter (our $0.37 forecast is in line with consensus) driven by solid organic sales growth with guidance unlikely to change. While we would have expected this to be enough to drive some improvement in sentiment given current valuation and the fact that estimates are likely at risk across much of our coverage, our discussions would suggest little to no change. Many agree that the stock is likely undervalued, but this has been the case for some time and with the next leg of the transaction still months away (i.e. the separation) it remains difficult to find a NT catalyst that will alter the narrative and drive shares higher. Even though the print next week is likely to be a non-event as a result, we think the risk/reward remains favorable with our SOTP analysis pointing to 22% upside following the recent pullback."

For an analyst ratings summary and ratings history on Keurig Dr Pepper click here. For more ratings news on Keurig Dr Pepper click here.

Shares of Keurig Dr Pepper closed at $26.04 yesterday.

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