Is Keurig Dr Pepper (KDP) Trading at a Discount?

Oakmark Funds, advised by Harris Associates, released its “Oakmark Global Fund” second quarter 2025 investor letter. The fund underperformed its benchmark, the MSCI World Index (net), in the second quarter. A copy of the letter can be downloaded here. The largest performance contributors were industrials and financials, at the sector level, while health care and energy detracted. In addition, you can check the top 5 holdings of the fund to know its best picks in 2025.

In its second quarter 2025 investor letter, Oakmark Global Fund highlighted stocks such as Keurig Dr Pepper Inc. (NASDAQ:KDP). Keurig Dr Pepper Inc. (NASDAQ:KDP) owns and distributes beverages and single serve brewing systems. The one-month return of Keurig Dr Pepper Inc. (NASDAQ:KDP) was 1.19%, and its shares gained 1.84% of their value over the last 52 weeks. On July 14, 2025, Keurig Dr Pepper Inc. (NASDAQ:KDP) stock closed at $33.26 per share, with a market capitalization of $45.173 billion.

Oakmark Global Fund stated the following regarding Keurig Dr Pepper Inc. (NASDAQ:KDP) in its second quarter 2025 investor letter:

"Keurig Dr Pepper Inc. (NASDAQ:KDP) is one of North America's leading beverage companies, with dominant positions in single serve coffee and flavored soft drinks. The soft drink portfolio has an enviable track record of volume growth and market share gains. We believe this strong performance can continue well into the future thanks to favorable demographic trends, brand strength and its unique distribution network. Recently, the stock price came under pressure due to fundamental weakness in the Keurig coffee division. At-home coffee consumption normalized as people returned to work, while price hikes are also weighing on demand. We believe these industry wide challenges will prove transitory as coffee remains a popular beverage across demographics. Keurig is poised to capitalize on this demand with the largest installed base of single-serve brewers and ample runway to further increase household penetration. At the current quote, the market as cribes minimal value to Keurig. We were happy to purchase shares in this above-average business that is trading at a discount to the market, other bever age peers and private market transactions."

Keurig Dr Pepper Inc. (NASDAQ:KDP) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 54 hedge fund portfolios held Keurig Dr Pepper Inc. (NASDAQ:KDP) at the end of the first quarter, which was 39 in the previous quarter. While we acknowledge the potential of KDP as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Keurig Dr Pepper Inc. (NASDAQ:KDP) and shared the list of best consumer goods stocks billionaires are quietly buying. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.