SoFi CEO enters prepaid forward contract on 1.5 million shares
BURLINGTON, Mass. and FRISCO, Texas - Keurig Dr Pepper Inc. (NASDAQ: NASDAQ:KDP), currently valued at approximately $46 billion, disclosed plans for a significant shift in its board composition following the sale of a substantial portion of its common stock by JAB Holding Company s.a.r.l., a key shareholder. JAB intends to sell 73 million KDP shares through a registered public offering, with an option for the underwriter to purchase up to an additional 10.95 million shares. According to InvestingPro data, KDP’s stock has delivered a robust 21.7% return over the past year.
Upon completion of the offering, JAB’s stake in KDP will decrease to approximately 10.7%. The shares JAB will continue to hold are subject to a 90-day lock-up agreement. This divestiture will lead to the resignation of Joachim Creus, Frank Engelen, and Olivier Goudet, all JAB-affiliated directors on KDP’s Board, effective upon the offering’s closure. The company maintains strong fundamentals, with InvestingPro analysis showing impressive gross profit margins of 55.6% and a consistent dividend growth track record of four consecutive years.
Joachim Creus, CEO of JAB, expressed gratitude for the collaborative efforts with KDP and confidence in the company’s ongoing leadership. Bob Gamgort, Executive Chairman of KDP, acknowledged the pivotal role of JAB since the private acquisition of Keurig Green Mountain in 2015 and emphasized KDP’s evolution into a widely held public company.
The secondary offering is managed by J.P. Morgan as the underwriter. Interested parties can obtain the prospectus from J.P. Morgan Securities LLC, which is also available on the SEC’s website.
Keurig Dr Pepper, a major North American beverage company, commands a diverse portfolio with over 125 brands and a strong distribution network. The company’s annual revenue reached $15.35 billion in the last twelve months, with a healthy revenue growth of 3.6%. The company maintains leadership in various beverage sectors, including coffee, soft drinks, and mixers. Based on InvestingPro’s Fair Value analysis, the stock is currently trading near its Fair Value, with analysts setting price targets ranging from $32.10 to $42.00 per share.
This announcement is based on a press release statement and includes forward-looking statements subject to uncertainties, as outlined in KDP’s regulatory filings. The company does not commit to updating these statements as per the applicable law.
In other recent news, Keurig Dr Pepper reported its fourth-quarter 2024 earnings, surpassing market expectations with an earnings per share (EPS) of $0.58, slightly above the forecast of $0.57. The company also exceeded revenue projections, posting $4.07 billion compared to the anticipated $4.02 billion. Analysts from Jefferies and Citi have both increased their price targets for Keurig Dr Pepper to $41, maintaining a Buy rating. Jefferies’ analyst Kaumil Gajrawala noted the company’s strong organic growth and EPS performance, while Citi’s Filippo Falorni highlighted the success in Refreshment Beverages and U.S. Coffee segments.
Despite facing significant coffee inflation, Keurig Dr Pepper has provided guidance for 2025 that aligns with its growth algorithm, projecting mid-single-digit percentage topline growth and high-single-digit percentage EPS growth. The company is considering additional price hikes for its coffee products to counter rising costs. Analysts have acknowledged the company’s strategic commercial plans and innovation efforts, including the addition of the GHOST brand, as positive drivers for future sales.
Keurig Dr Pepper’s commitment to its guidance and the positive outlook from analysts like Jefferies and Citi suggest confidence in the company’s strategy amidst a competitive market environment. The company’s valuation remains appealing, with Citi noting it stands at approximately 17.3 times the estimated P/E for 2025. These developments reflect Keurig Dr Pepper’s robust performance and strategic initiatives aimed at sustaining growth in a challenging economic landscape.
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