SUPERNEWS - NASDAQ:KDP (Keurig Dr Pepper Inc.) Stock Price, News, Quote, History

Beverage Giants Battle: Sports Drink Market Shakeup

<img src="https://cdn.tickerbell.ai/article/img/6eaf2906af46-4486-ad5c-1635c1f9b962.png" alt="article-main-img" class="article-img" /> ## Key Takeaway ```Pepsico faces new competition from sports drink startup Prime, impacting Gatorade sales, but remains the market leader with over 60% share. Analysts are watching if new products can fend off rivals and drive growth amid a broader beverage stock downturn.``` ## Sports Drink Turf War Impact on Beverage Stocks - Pepsico CEO Ramon Laguarta acknowledged the impact of sports drink startup Prime on Gatorade sales, with shares of Pepsico, Coca-Cola, and Keurig Dr Pepper all down over the past 12 months. - The rise of Prime has led to increased competition in the sports drink industry and is emblematic of the growth for trendy, health-conscious options across different snack and beverage categories. - Barclays analyst Lauren Lieberman noted that newer versions of Gatorade such as Gatorade Zero, G-Fit, and Gatorlyte are proving to be long-term hits and may help incumbents fend off competition. ## Competition in Sports Drink Industry - Original Gatorade accounts for more than 60% of the market share while Prime remains below 10%, indicating that it's unlikely for Gatorade to be overtaken any time soon. - Other deep-pocketed rivals like Coca-Cola with Powerade and Bodyarmor, as well as Keurig Dr Pepper with Electrolit present significant competition in the sports drink category. - Analysts believe that expanding popularity outside different customer segments will be a key factor in determining success for new brands. ## Investment Perspective - Wall Street analysts are close to a 50-50 split on Pepsico and Keurig Dr Pepper. - More than 70% recommend Coca-Cola stock but show only about a 10% upside based on average price targets. - Investors should closely monitor this quarter’s earnings calls from beverage companies to understand how the sports drink battle is developing. Pepsico is set to release its fourth-quarter results on Feb. 9. ## STREET VIEWS - Barclays Analyst Lauren Lieberman (Neutral): > "Whether Prime’s success proves sticky or to be a flash in the pan, we think it is serving as an important template for how quickly brands can be built and that there is space for ‘indulgence’ in the sports drink category." - Wedbush Analyst Gerald Pascarelli: > “These other brands will gain some share, but Gatorade is such an important brand that Pepsi will continue to make the investments and will not give up that leadership position. That’s one of the most important brands in their portfolio.” - Barclays Analyst Lauren Lieberman (Neutral): > "We believe sports drinks present one of KO’s biggest pathways toward margin improvement in the US, with the ambition to be best-in-class within the category. ... And as such, the company has made clear that shoring up sports drinks is one of its top priorities heading into 2024." <div style="display: flex; flex-direction: row;" class="divbox"> <a style="display: flex; flex-direction: row;" class="MuiButtonBase-root wallstreet-review-item" href="https://www.cnbc.com/2024/01/06/a-sports-drinks-turf-war-could-determine-whether-beverage-stocks-bounce-back-in-2024.html" target="_blank" rel="noopener noreferrer"> <div style="font-family: monospace; display: flex; ">  [1]  </div> <span> A sports drinks turf war could determine whether beverage stocks bounce back in 2024    </span> <span class="MuiTouchRipple-root"></span> </a> </div><div style="display: flex; flex-direction: row;" class="divbox"> <a style="display: flex; flex-direction: row;" class="MuiButtonBase-root wallstreet-review-item" href="https://www.bloomberg.com/news/articles/2024-01-06/d1-hedge-fund-stung-by-big-venture-bets-for-second-straight-year" target="_blank" rel="noopener noreferrer"> <div style="font-family: monospace; display: flex; ">  [2]  </div> <span> D1 Hedge Fund Stung by Big Venture Bets for Second Straight Year    </span> <span class="MuiTouchRipple-root"></span> </a> </div><div style="display: flex; flex-direction: row;" class="divbox"> <a style="display: flex; flex-direction: row;" class="MuiButtonBase-root wallstreet-review-item" href="https://www.cnbc.com/2024/01/06/morgan-stanley-names-its-top-stocks-for-2024-including-this-streaming-giant.html" target="_blank" rel="noopener noreferrer"> <div style="font-family: monospace; display: flex; ">  [3]  </div> <span> Morgan Stanley names its top stocks for 2024, including this streaming giant    </span> <span class="MuiTouchRipple-root"></span> </a> </div>

1/9, 21:25 EST