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Varchild2008 (84.20)

What's the Big Deal with Concentrate?



June 26, 2008 – Comments (2) | RELATED TICKERS: DPS

Dr. Pepper Snapple Group is at its 52 week low.  Trading for an obscene $22 and whatever cents.

Analysts have come out of the woodwork to include Seeking Alpha, claiming the stock is waaay oversold due to DPS's concentrate business.

I happen to agree.  But, I happen to not care either.  I am not ready to take the plunge and buy more shares of DPS yet so I'm hoping this stays oversold for at least a few more weeks.

Nonetheless.... Here's a quick explanation of DPS's concentrate business:

1) Snapple Products
2) Welch's Grape Juice products
3)  Schwepps Juice products.

All of which are huge brands, sold in all of the grocery stores.  Hugely popular in the Midwest.

So, I am definitely salivating over 2010 as the year DPS really breaks out.  Once that California Facility gets built and DPS can start shipping out product to tens of millions of new customers.... Investors will go nutz over DPS.

In the meantime.... A DPS investor must use this wonderful oversold rally on DPS to scoop up shares and hold 'em.   I'd not bother to fret over the stock price unless 2010 strangely is a down year.

2 Comments – Post Your Own

#1) On June 26, 2008 at 8:10 AM, DemonDoug (31.17) wrote:

what about kroger's earnings report where they said store brands are strong but other named brands are softening?

Man you are really pumping DPS varchild. You must really believe in them.  I'm not sure I see why you are quite so bullish.

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#2) On June 26, 2008 at 5:59 PM, Varchild2008 (84.20) wrote:

Don't misunderstand my bullishness.

I am not saying DPS is a buy today.... I've been saying over and over in numerous articles that DPS = Sell-off for quite awhile.

And that's going to continue probably until 2010.  How can you say I am BULLISH???  When I am BEARISH until 2010.

My stance though.... Is that you invest in a Company... Not in a short-term stock price valuation.

DPS's stock price is undervalued big time.  But the problem is that this wil continue for quite a long while until Dr. Pepper Snapple Group gets its feet on the ground.

You have to realize and think real hard about what 2010 will look like for DPS.  Why not *SLOWLY* scoop up some shares now while the stock price is pathetically low and see what happens in 2010?

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