Beverage maker Dr Pepper Snapple Group Inc (
) on Tuesday caught a huge upgrade from analysts at Wells
The firm boosted its rating on DPS from "Market Perform" to
"Outperform" and lifted its price target range from $36-38 to
$45-47. That new range suggests up to an 11% upside to the stock's
Monday closing price of $42.45.
A Wells Fargo analyst commented, "We now expect DPS will benefit
from a material acceleration in EPS growth in 2013 (+11.7%) and
multiple expansion over the next few months. If recent commodity
price trends hold over the next quarter, DPS should demonstrate
significant earnings leverage in 2013 - well in excess of current
'street' estimates. Furthermore, we think DPS valuation multiples
should expand due to: (1) the company's improved performance
optics, (2) ongoing rational industry pricing, (3) limited negative
impact from increased PEP marketing spend, and (4) a 'flight to
quality' in the consumer sector."
Wells Fargo also boosted its fiscal fourth quarter, full-year
2012, and full-year 2013 earnings estimates for the company.
Dr Pepper Snapple shares were mostly flat in premarket trading
The Bottom Line
Shares of Dr. Pepper Snapple Gropup (
) have a 3.20% dividend yield, based on last night's closing stock
price of $42.45. The stock has technical support in the $39-$40
price area. The shares are trading at all-time highs.
Dr Pepper Snapple Group Inc (
) is not recommended at this time, holding a Dividend.com DARS™
Rating of 3.4 out of 5 stars.
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, as well as a detailed explanation of
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