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How Far Can KDP's Energy & Hydration Bet Go in a Shifting Market?

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Key Takeaways

  • KDP's energy portfolio drove 6.4% constant currency net sales growth in Q1 2025.
  • GHOST Energy, newly in KDP's DSD network, added 4.8 points to volume mix and saw double-digit retail growth.
  • Strategic brand moves like Electrolit and Bloom boost reach as KDP eyes energy for long-term momentum.

Keurig Dr Pepper (KDP - Free Report) is making significant strides in the energy drinks beverage category by establishing a comprehensive portfolio that targets various sub-segments of the market. The company’s approach blends acquisitions and partnerships, like its full distribution integration of GHOST Energy, a growing partnership with C4 and support for emerging brands like Bloom Sparkling Energy and Black Rifle Energy.

Energy drinks are not just a standalone offering for KDP; they are a broader, synergistic platform. Each brand serves a unique consumer niche: C4 appeals to performance-focused consumers, GHOST targets lifestyle enthusiasts, Bloom focuses on female-forward positioning and Electrolit extends into the sports hydration space. This multi-brand approach enhances KDP’s credibility in the energy category while diversifying its risk and maximizing reach.

KDP's energy drinks portfolio contributed 6.4% constant currency net sales growth in first-quarter 2025. GHOST Energy, now fully integrated into KDP’s DSD network, posted double-digit retail growth and contributed 4.8 points to volume mix growth. C4 remained strong, Bloom scaled quickly to half a share point and Electrolit gained traction in sports hydration. Together, these brands drove 11% growth in U.S. Refreshment Beverages, boosted further by solid Dr Pepper performance, highlighting that KDP’s energy play is gaining scale and shelf impact.

Keurig Dr Pepper expects energy and sports hydration to remain high-growth categories and is well-positioned to capitalize on this momentum. With favorable consumption trends and compelling innovation planned across its brands, management is bullish on continued growth in energy drinks through the rest of 2025 despite macroeconomic uncertainties and tariff pressures. The energy drink’s momentum is also expected to offset headwinds in other segments like coffee and reinforce KDP’s broader beverage leadership.

KDP’s Zacks Rank & Share Price Performance

Shares of this Zacks Rank #3 (Hold) company have appreciated 3.1% in the past year, outperforming the Zacks Beverages - Soft Drinks industry’s decline of 2.0% and the broader Consumer Staples industry’s return of 1.1%.

KDP Stock's Past Year Performance

Zacks Investment Research
Image Source: Zacks Investment Research

Is KDP Stock a Value Play?

Keurig Dr Pepper shares are currently trading at a forward 12-month price-to-earnings (P/E) multiple of 15.93X, which positions it at a discount compared with the industry’s average of 17.99X. The stock is undervalued compared with its industry peers, offering compelling value to investors looking for exposure to the consumer staple sector.

KDP P/E Ratio (Forward 12 Months)

Zacks Investment Research
Image Source: Zacks Investment Research

Key Picks

Carlsberg (CABGY - Free Report) , a brewing company with a beer portfolio of more than 500 brands, currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.


The Zacks Consensus Estimate for Carlsberg’s current financial-year sales and EPS indicates growth of 31.8% and 11.3%, respectively, from the prior-year reported levels.

Zevia (ZVIA - Free Report) is a beverage company that produces and sells various carbonated beverages in the United States and Canada. It currently carries a Zacks Rank of 2.

The consensus estimate for Zevia’s current year EPS implies growth of 48.4% from the year-ago reported number. ZVIA has a trailing four-quarter average earnings surprise of 33.6%.

BRF S.A. (BRFS - Free Report) raises, produces and slaughters poultry and pork for the processing, production and sale of fresh meat, processed products, pasta, margarine, pet food and other products. It currently carries a Zacks Rank of 2.

The Zacks Consensus Estimate for BRF S.A.'s current fiscal-year earnings implies growth of 8.3% from the prior-year level. BRFS delivered a trailing four-quarter earnings surprise of 5.4%, on average.


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