📊 KDP Key Takeaways
Is Keurig Dr Pepper Inc. (KDP) a Good Investment?
Despite solid operational performance with 8.2% revenue growth and healthy 52.8% gross margins, KDP is burdened by excessive leverage with critically low 1.5x interest coverage and minimal debt service capacity. The extremely poor returns on equity (1.1%) and assets (0.4%) reveal severe capital inefficiency, while inadequate free cash flow generation ($165M) cannot meaningfully reduce the $20.9B debt load.
Keurig Dr Pepper posts solid revenue growth with strong gross and operating margins, driving a sharp uptick in earnings and healthy free cash flow. Leverage is moderate with comfortable interest coverage, though liquidity is tight and returns on equity are only modest. If margin resilience and cash conversion persist, fundamentals support continued outperformance versus typical beverage peers.
Why Buy Keurig Dr Pepper Inc. Stock? KDP Key Strengths
- Revenue growth of 8.2% YoY demonstrates sustained market demand
- Gross margin of 52.8% reflects strong pricing power and operational efficiency in beverages
- Operating margin of 19% shows solid core business profitability
- Consistent top-line growth (+8.2% YoY).
- Robust margin profile (54.2% gross, 21.5% operating).
- Healthy FCF ($1.5B; 9.1% margin) and solid interest coverage (7.2x).
KDP Stock Risks: Keurig Dr Pepper Inc. Investment Risks
- Interest coverage of 1.5x is dangerously low with minimal buffer; any operating decline risks financial distress
- High absolute debt ($20.9B) relative to equity ($25.3B) with insufficient cash position ($898M) limits financial flexibility
- Extremely poor ROE (1.1%) and ROA (0.4%) indicate severe capital inefficiency and wealth destruction
- Tight liquidity (current 0.64x; quick 0.43x).
- Modest ROE/ROA (8.1%/3.7%) indicating limited capital efficiency.
- Exposure to input cost inflation and competitive pricing pressure on margins.
Key Metrics to Watch
- Interest coverage ratio - any decline below 1.5x signals acute financial stress
- Free cash flow and debt reduction trends - essential to reducing leverage risk
- Operating income stability - critical given minimal interest cushion
- Organic revenue growth (volume vs. pricing mix)
- Operating margin and FCF margin
Keurig Dr Pepper Inc. (KDP) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The relatively thin 4.1% FCF margin may limit capital allocation flexibility. Strong liquidity with a 2.31x current ratio provides a solid financial cushion.
KDP Profit Margin, ROE & Profitability Analysis
KDP vs Consumer Sector: How Keurig Dr Pepper Inc. Compares
How Keurig Dr Pepper Inc. compares to Consumer sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Keurig Dr Pepper Inc. Stock Overvalued? KDP Valuation Analysis 2026
Based on fundamental analysis, Keurig Dr Pepper Inc. has mixed fundamental signals relative to the Consumer sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Keurig Dr Pepper Inc. Balance Sheet: KDP Debt, Cash & Liquidity
KDP Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Keurig Dr Pepper Inc.'s revenue has grown significantly by 31% over the 5-year period, indicating strong business expansion. The most recent EPS of $1.55 reflects profitable operations.
KDP Revenue Growth, EPS Growth & YoY Performance
KDP Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $3.6B | $270.0M | $0.20 |
| Q3 2025 | $3.9B | $454.0M | $0.45 |
| Q2 2025 | $3.9B | $454.0M | $0.38 |
| Q1 2025 | $3.5B | $454.0M | $0.33 |
| Q3 2024 | $3.8B | $454.0M | $0.37 |
| Q2 2024 | $3.8B | $454.0M | $0.36 |
| Q1 2024 | $3.4B | $454.0M | $0.33 |
| Q3 2023 | $3.6B | $180.0M | $0.13 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Keurig Dr Pepper Inc. Dividends, Buybacks & Capital Allocation
KDP SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Keurig Dr Pepper Inc. (CIK: 0001418135)
📋 Recent SEC Filings
❓ Frequently Asked Questions about KDP
What is the AI rating for KDP?
Keurig Dr Pepper Inc. (KDP) has a Combined AI Rating of HOLD from Claude (SELL) and ChatGPT (BUY) with 75% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are KDP's key strengths?
Claude: Revenue growth of 8.2% YoY demonstrates sustained market demand. Gross margin of 52.8% reflects strong pricing power and operational efficiency in beverages. ChatGPT: Consistent top-line growth (+8.2% YoY).. Robust margin profile (54.2% gross, 21.5% operating)..
What are the risks of investing in KDP?
Claude: Interest coverage of 1.5x is dangerously low with minimal buffer; any operating decline risks financial distress. High absolute debt ($20.9B) relative to equity ($25.3B) with insufficient cash position ($898M) limits financial flexibility. ChatGPT: Tight liquidity (current 0.64x; quick 0.43x).. Modest ROE/ROA (8.1%/3.7%) indicating limited capital efficiency..
What is KDP's revenue and growth?
Keurig Dr Pepper Inc. reported revenue of $4.0B.
Does KDP pay dividends?
Keurig Dr Pepper Inc. pays dividends, with $312.0M distributed to shareholders in the trailing twelve months.
Where can I find KDP SEC filings?
Official SEC filings for Keurig Dr Pepper Inc. (CIK: 0001418135) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is KDP's EPS?
Keurig Dr Pepper Inc. has a diluted EPS of $0.20.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is KDP a good stock to buy right now?
Based on our AI fundamental analysis in May 2026, Keurig Dr Pepper Inc. has a HOLD rating with 75% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is KDP stock overvalued or undervalued?
Valuation metrics for KDP: ROE of 1.1% (sector avg: 18%), net margin of 6.8% (sector avg: 8%). Compare these metrics with sector averages to assess valuation.
Should I buy KDP stock in 2026?
Our dual AI analysis gives Keurig Dr Pepper Inc. a combined HOLD rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is KDP's free cash flow?
Keurig Dr Pepper Inc.'s operating cash flow is $281.0M, with capital expenditures of $116.0M. FCF margin is 4.1%.
How does KDP compare to other Consumer stocks?
Vs Consumer sector averages: Net margin 6.8% (avg: 8%), ROE 1.1% (avg: 18%), current ratio 2.31 (avg: 1.5).