Report
Sonia Vora
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Long-Term Outlook Intact After Keurig Dr Pepper Posts 2Q Results; Shares Not Cheap

Wide-moat Keurig Dr Pepper posted solid second-quarter results for stand-alone Keurig Green Mountain and Dr Pepper Snapple. Dr Pepper Snapple on a stand-alone basis increased sales 5%, with a roughly 60% contribution from price/mix; this tracked ahead of our full-year outlook of below 4%. However, operating margin contracted around 170 basis points to 19% as commodity inflation and increased logistics costs, both of which have been weighing on firms across the industry, compressed profitability....
Underlying
Keurig Dr Pepper Inc.

Keurig Dr Pepper is a beverage company with a portfolio of flavored (non-cola) carbonated soft drinks (CSDs), non-carbonated beverages, and is a producer of single serve brewing systems. The company's Coffee Systems segment develops and sells a variety of Keurig brewers, brewer accessories and other coffee-related equipment. The company's Packaged Beverages segment manufactures and distributes packaged beverages of its brands. The company's Beverage Concentrates segment manufactures and sells beverage concentrates. The company's Latin America Beverages segment participates mainly in the carbonated mineral water, flavored CSD, bottled water and vegetable juice categories.

Provider
Morningstar
Morningstar

Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.

Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.

We have operations in 27 countries.

Analysts
Sonia Vora

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