Keurig Dr Pepper Inc. (KDP) Rated ‘Overweight’ at Piper Sandler, Price Target Cut

Core Viewpoint - Keurig Dr Pepper Inc. (KDP) is viewed as a strong investment in the FMCG sector, despite a recent price target reduction due to concerns over debt levels following the JDEP acquisition [1][2]. Financial Performance - Piper Sandler has lowered the price target for KDP from $40 to $35, citing concerns that the company's pro forma leverage could reach 5.2X by the end of 2026, before decreasing to 4.3X by the end of 2027 [2]. - The earnings per share estimate has been revised down to a range of $2.01 to $2.06, from an initial expectation of $2.17 to $2.14 [2]. Market Position - Piper Sandler remains optimistic about KDP's momentum in the U.S. retail beverage sector, highlighting its competitive edge among soda makers [3]. - The company is expected to see a $20 million increase in revenue in the third quarter attributed to the Ghost brand [3]. Company Overview - Keurig Dr Pepper Inc. is a beverage company that markets over 125 brands across various categories, including soft drinks, coffee, tea, water, and juice, with notable brands such as Dr Pepper, Snapple, and Canada Dry [4].