Skip to main content

Market Overview

Why Dr Pepper Snapple Is Having A Big Day

Share:

Shares of Dr Pepper Snapple Group Inc. (NYSE: DPS) are up Thursday morning. Stifel analysts Mark Swartzberg and Christopher Sinnott upgraded the stock from Hold to Buy, and also set a price target of $90.

According to a report recently published, the upgrade was based on valuation and an improving U.S. outlook, which translates into expected revenue and EPS upside to consensus estimates.

Stifel's revenue estimates for 2015, 2016 and 2017 were increased from $6.227 billion, $6.420 billion, and $6.620 billion, respectively, to $6.286 billion, $6.494 billion, and $6.709 billion.

Related Link: Benzinga's Top Upgrades

EPS estimates for the same period were raised from $3.93, $4.26, and $4.54, respectively, to $4.01, $4.47, and $4.92 (versus consensus of $3.88, $4.14, and $4.42).

The $90 price target reflects a 20.1x multiple to the firm's 2016 EPS estimate of $4.47. The analysts expect Dr Pepper Snapple's multiple to expand "as earnings momentum continues and given DPS's valuation history."

They add:

  • "DPS's forward P/E has contracted to the noted 18.6x from 20.3x at yearend 2014. We attribute this mainly to rotation from Staples and expect it to reverse since the interest rate outlook is broadly stable and DPS participates in a stable-to-improving industry."
  • "DPS began trading at P/E parity to XLP last summer. We take this as a sign the market is beginning to attach a better outlook to DPS fundamentals."

Latest Ratings for DPS

DateFirmActionFromTo
Jun 2018Stifel NicolausDowngradesBuyHold
Mar 2018RBC CapitalUpgradesSector PerformOutperform
Mar 2018Stifel NicolausMaintainsBuyBuy

View More Analyst Ratings for DPS
View the Latest Analyst Ratings

 

Related Articles (DPS)

View Comments and Join the Discussion!

Posted-In: Christopher Sinnott Mark Swartzberg StifelAnalyst Color Upgrades Price Target Analyst Ratings Movers

Latest Ratings

StockFirmActionPT
GIKColliers SecuritiesInitiates Coverage On14.0
SANWLake StreetInitiates Coverage On6.0
LILAMorgan StanleyDowngrades15.0
BEJP MorganUpgrades36.0
NEXACredit SuisseUpgrades11.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
SPAC
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com