Matthew Archambault, the President of Commercial at Keurig Dr Pepper Inc (NASDAQ:KDP), recently sold 40,000 shares of the company. This sale is part of a series of transactions over the past year that have seen a total of 56,700 shares sold and no shares purchased by Archambault.
Keurig Dr Pepper Inc is a prominent beverage company in North America, generating annual revenue exceeding $11 billion. The company boasts a portfolio of over 125 owned, licensed, and partner brands, catering to a wide range of consumer needs.
The insider transaction history for Keurig Dr Pepper Inc shows a mixed trend, with 15 insider buys and 11 insider sells over the past year. Archambault’s recent sell may reflect his sentiment towards the company’s stock.
At the time of the sale, Keurig Dr Pepper Inc shares were trading at $33.61 per share, giving the stock a market capitalization of $46.53 billion. This is an important valuation to note, as the insider chose to sell at this price.
The price-earnings ratio (P/E ratio) of Keurig Dr Pepper Inc is 29.23, which is higher than both the industry median of 17.96 and the company’s historical median P/E ratio. This suggests that the stock may be overvalued, potentially explaining Archambault’s decision to sell.
However, according to the GuruFocus Value, which is an intrinsic value estimate developed by GuruFocus, the stock is modestly undervalued. With a current price of $33.61 and a GuruFocus Value of $41.44, Keurig Dr Pepper Inc has a price-to-GuruFocus Value ratio of 0.81. This indicates that the stock may still offer value to investors, despite the recent sell-off by Archambault.
The GuruFocus Value is calculated based on historical multiples at which the stock has traded, a GuruFocus adjustment factor based on the company’s past performance, and future performance estimates from Morningstar analysts.
In summary, Archambault’s recent sell of Keurig Dr Pepper Inc shares may be viewed as a bearish signal, particularly considering the stock’s high P/E ratio. However, the stock’s modest undervaluation according to the GuruFocus Value suggests that there may still be potential for investors. It is crucial for investors to conduct their own research and consider multiple factors before making any investment decisions.
Source: This article first appeared on GuruFocus.