Dr Pepper Snapple Group, Inc.
) reached a 52-week high of $52.66 on Feb 26, 2014 following
solid fourth quarter 2013 results and dividend hikes announced
earlier this month. The closing price of the cola giant on Feb
26, 2013 was $51.59, representing a solid year-to-date return of
BUFFALO WLD WNG (BWLD): Free Stock Analysis
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DR PEPPER SNAPL (DPS): Free Stock Analysis
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Solid Fourth Quarter Performance
The share price of Dr Pepper Snapple has been rising in February
backed by a string of good news which includes the solid fourth
quarter 2013 earnings results, a dividend hike and a strategic
Buffalo Wild Wings, Inc.
Dr Pepper Snapple Group's fourth-quarter 2013 adjusted earnings
of 97 cents per share beat the Zacks Consensus Estimate of 85
cents by 14.1%. Moreover, earnings increased 18.3% year over year
due to pricing gains, productivity improvements and a LIFO
Though sales were relatively softer, adjusted operating income
increased 10.2% year over year to $323 million during the
quarter, owing to lower expenses. The company's cash position is
also strong. In fact, a week prior to its earnings announcement
the company declared a 7.9% increase in quarterly dividend.
On Feb 11, the company entered into an agreement with Buffalo
Wild Wings to offer its drinks at all Buffalo Wild Wings
restaurants by mid 2014. Buffalo Wild Wings is popular among
sports fans for its dine-and-watch games facility. Also,
Buffalo Wild Wings offerings are marked by strong flavors, which
perfectly complement the beverages from Dr Pepper Snapple.
Moreover, all major sporting events are scheduled the same way as
in the year-ago period with the addition of Winter Olympics. The
sport events are expected to boost guest traffic at Buffalo Wild
Wings restaurants. As DPS drinks will be served in these
restaurants, this in turn will boost sales volume.
Estimates have mostly gone up after Dr Pepper announced strong
fourth quarter results and the agreement with Buffalo Wild Wings.
As such, over the last 30 days, the Zacks consensus for the
fiscal 2014 rose 3.7% to $3.39, whereas the estimates for fiscal
2015 rose 3.2% to $3.60.
Dr Pepper Snapple presently has a Zacks Rank #2 (Buy). Other
stocks worth considering in the sector include
Coca-Cola Enterprises Inc.
Monster Beverage Corporation
), both pf which carry the same Zacks Rank as Dr Pepper