Rebounding demand from e-commerce platforms, fountain retailers, in addition to new product launches and rising investor optimism in the consumer defensive industry should benefit Coca-Cola (KO) and Keurig Dr Pepper (NASDAQ:KDP). But which of these stocks is a better buy now? Read more to find out.The Coca-Cola Company (NYSE:KO) and Keurig Dr Pepper Inc. (KDP) are two prominent players in the non-alcoholic beverage industry. KO owns or licenses, and markets beverage concentrates, finished sparkling soft-drinks brands, energy drinks, dairy, and syrups to fountain retailers such as restaurants and convenience stores. It operates through independent bottling partners, distributors, wholesalers, retailers, and bottling and distribution operators. In comparison, KDP manufactures and distributes soft drinks, juices, teas, mixers, water, and other beverages to retailers, bottlers and distributors, restaurants, hotel chains, office coffee distributors, and end-use consumers. It operates through Coffee Systems; Packaged Beverages; Beverage Concentrates; and Latin America Beverages segments.
With restaurants and tourist places witnessing increasing foot traffic, now that travel restrictions are being eased gradually, the non-alcoholic beverage industry is seeing increasing demand for healthy, refreshing, and ready-to-drink beverages. Both fountain retailers and e-commerce platforms are witnessing rising demand for such beverages. The non-alcoholic beverages market is expected to grow at an 8.2% CAGR to $1.73 trillion by 2028. Moreover, being part of the consumer defensive industry, shares of beverage companies are witnessing increasing investor attention amid the market volatility. So, both KO and KDP are expected to benefit.
While KDP has gained 16.5% over the past year, KO surged 7.4%. In terms of their past nine months’ performance, KDP is a winner with a 3.6% gain versus KO’s marginal return. But which of these stocks is a better pick now? Let’s find out.