Keurig Dr Pepper (KDP) posted a "solid" quarter, with strength in US Refreshment Beverages offset by continued softness in US Coffee, RBC Capital Markets said in note Friday.
Refreshment Beverages saw constant-currency sales growth well above consensus on Dr. Pepper share gains and energy drink momentum, while US Coffee organic sales fell short on weak volumes, partly tied to a Peet's acquisition reporting shift RBC expects to reverse in the second half.
Management reaffirmed its early 2027 separation timeline, RBC said, combined with one-time EPS timing benefits this quarter, implies a slower second-half bottom line performance than previously expected.
RBC maintained its outperform rating on the stock and $42 price target.
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