Jim Cramer on Keurig Dr Pepper: "I Don't Want to Touch That One"

Keurig Dr Pepper Inc. (NASDAQ:KDP) is one of the 12 stocks on Jim Cramer’s radar recently. A caller asked if the company would be able to compete with Coca-Cola long term despite its “high debt”. In response, Cramer said:

“Yeah, no, I don’t want to touch that one. I think if you want to be in that space, you want to be in Coca-Cola. I think Coca-Cola has demonstrated, first of all, I don’t want to be in that space because there’s just… the Secretary of Health and Human Services is against it. The GLP-1s, the new one from Amgen, just makes it tougher and tougher. You don’t want to be in the space…”

Keurig Dr Pepper (NASDAQ:KDP) produces and distributes a wide range of beverages and single-serve brewing systems, including branded concentrates, ready-to-drink products, and coffee-related goods. Oakmark Select Fund stated the following regarding Keurig Dr Pepper Inc. (NASDAQ:KDP) in its Q4 2024 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 impressive track record of volume growth and market share gains. We believe this performance can continue due to favorable demographic trends, brand strength, and distribution advantages. Recently, weakness in the Keurig coffee division caused the stock price to come under pressure. However, we believe these industry-wide challenges will prove transitory because coffee remains a popular beverage. Keurig’s coffee division is poised to capitalize on this demand with the largest installed base of single-serve brewers and ample runway to increase household penetration. At the current quote, the market ascribes minimal value to Keurig. We were happy to purchase shares in this above-average business at a discount to the market multiple, other beverage peers and private market transactions.”

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.

READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money.

Disclosure: None.