Good topic. I agree: this could go either way...but as a betting man, I'd say we climb steadily higher. Flavored CSD's are doing better than colas - we all know that. Dr. Peper (especially the diet DP) is the hot brand right now. They've got a great marketing and distribution network. And if Europe implodes (the Greek debt crisis, the possible collapse of the Euro, a deeper recesion in Europe, etc.), then Coke and Pepsi will take a hit and DPS will continue to expand as the US pulls out of its recession, and its Latin American and Canadian operations expand. I say -- given that the US economic expansion was stronger in Q1 than what people expectd it would be -- that DPS does well. And we move higher. Just my guess. And where I am putting my money.
All depends, Phrap, on what they report. Consensus is looking for .38 a share. If they hit it or are below, you could see some sell off. If they hit it and go above, it will all depend on how much. it will also depend on guidance, outlook on Coke deal, outlook on divs and any further buy-backs, etc. Been seeing some good marketing initiatives and expansion of market (further roll out of Diet/Regular Dr. Pepper at McDonald's, the NFL Pittsburgh deal, the further role out of the $.79 value can of Snapple, etc.). So it will all depend. Personally, I target this as a $38-$42 stock, six to 12 months out. With the healthy dividend and good prospects for increases in that div in the months ahead, I'm happy with either direction. If it sells off a bit, I have some dry powder to add to my holdings. If it goes up, I have enough of holdings to be a happy camper.