Keurig Dr Pepper (KDP) Shares Hold Buy Rating Despite JDE Peet’s Acquisition Concerns

Core Insights - Keurig Dr Pepper Inc. (NASDAQ:KDP) is considered one of the most active stocks to buy according to Wall Street analysts, with UBS recently lowering its price target from $40 to $35 while maintaining a Buy rating [1][2] Group 1: Acquisition Impact - The acquisition of JDE Peet's has created confusion regarding the company's future catalysts, especially as investors had previously become optimistic about improved visibility in revenue and earnings [2] - The transaction has increased execution risk and raised leverage to over 5x, which is a concern for investors [2] Group 2: Market Response and Strategic Justification - Despite concerns, UBS believes the market's negative reaction is disproportionate, arguing that the strategic rationale for separating the businesses is sound [3] - The first-year accretion from the transaction and potential upside from a sum-of-the-parts analysis are being overlooked by the market [3] Group 3: Company Overview - Keurig Dr Pepper Inc. was formed from a merger in 2018 and includes well-known brands such as Dr Pepper, Canada Dry, Snapple, Keurig single-serve coffee pods, and Ghost energy drinks [3]