Dr Pepper Snapple Group (
) will report earnings before the market opens April 23, and
analysts expect an 11% year-over-year gain to 59 cents a
The Plano, Texas-based beverage company is a mature company
and a slow grower, but offers an above-average and growing
Dr Pepper Snapple has more than 50 brands. In addition to the
flagship brands, it has 7UP, A&W, Canada Dry, Clamato, Crush
and Hawaiian Punch.
Over the last two quarters, EPS has risen 11% and 18%, but
sales growth has been flat. The company has a five-year
annualized EPS growth rate of 13%, but the equivalent sales
growth rate is only 2%. Analysts expect earnings to grow 7% this
year and 6% next year.
The five-year Earnings Stability Factor is 5 on a 0 to 99
scale where low numbers correspond to steady growth.
The return on equity is an impressive 29%, well above the 17%
benchmark. The pretax margin is 17%. The debt-to-equity ratio is
The company has a long and colorful history. A Waco, Texas,
pharmacist, Charles Alderton, invented Dr Pepper in 1885 and
served it in his drug store. It was originally called a Waco, but
was later named after Alderton's friend, Dr. Charles Pepper.
The Snapple drinks were first sold in New York health clubs in
the 1970s. Both brands were ultimately acquired by British-based
confectionery company Cadbury Schweppes, combined into a North
American operation and spun off as a separate company in
Dr Pepper Snapple has raised its dividend each year, starting
out with a 15-cent-per-share quarterly payout, which was raised
to 41 cents this year. That works out to a 3.2% annual yield and
a three- to five-year dividend growth rate of 18%.