By How Much Does Dr Pepper’s Value Rise If Its Margin Grows By More Than Expected?
Dr Pepper Snapple (NYSE:DPS) has had a solid 2016 so far, increasing guidance on full-year estimates twice — after the announcement of Q2 results, and after the announcement of Q3 results. Solid operational performance, leading to an increase in margin, despite a decline in the top line, pushed up estimates for the full-year earnings for Dr Pepper. The company now expects full-year core EPS to be in the $4.32-$4.40 range, up from the updated estimate of $4.27-$4.35 after the second quarter results.
North America forms >95% of the overall EBIT for Dr Pepper, and due to effective pricing and low commodity costs, Dr Pepper’s operating margin rose 80 basis points to 26.2% through September.
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Considering a scenario where Dr Pepper’s margin rises by more than expected currently, the company’s value will rise by almost 10%.
Have more questions on Dr Pepper Snapple? See the links below.
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- What’s Dr Pepper Snapple’s Fundamental Value Based On Expected 2016 Results?
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- How Much Revenue Can Latin America Add By 2018 For Dr Pepper?
- Breakdown Of Dr Pepper’s U.S. CSD Vs Mexico CSD Presence
- How Much Can CSDs Add To Dr Pepper’s Top Line By 2018?
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- 2015 Year In Review: Dr Pepper Snapple
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