Keurig Dr Pepper's energy drink play expected to pay off
George Frey

Bank of America sees long-term upside for Keurig Dr Pepper (NASDAQ:KDP) from the new strategic partnership with Nutrabolt and the equity stake it took in the company. 
The firm noted the long-term sales and distribution rights will allow Keurig Dr Pepper (KDP) to sell C4 performance energy drinks through its owned direct-store distribution network.
"In our view, this deal makes strategic sense given KDPâs appetite to expand its portfolio via partnerships/acquisitions and in that it also provides a meaningful entry into the Energy drink category, closing a gap in the portfolio and adding scale to KDP DSD network."
As for the deal price, BofA said based on estimated 2023 C4 net sales of $650M, the transaction implies an enterprise value of between $2.88B to $2.47B, and an EV/sales multiple of 3.8X to 4.4X. 
Bank of America has a Buy rating on Keurig Dr Pepper (KDP) and price objective of $45.
Read more details about the Nutrabolt deal.