Moody's raises Keurig Dr Pepper

Moody's Investors Service said it upgraded Keurig Dr Pepper Inc.'s senior unsecured ratings to Baa1 from Baa2.

“The upgrades reflect KDP's continued strong operating performance and consistent improvement in financial leverage following the merger of Keurig and Dr Pepper Snapple Group in 2018. Moody's expects the company to continue to perform well over the next 12-18 months and focus on reducing financial leverage further.

“The rating change also recognizes management's new and more conservative financial policy with a commitment to further reduce leverage to a range of 2x-2.5x net debt to EBITDA (company calculated, 2.8x as of Dec. 31, 2022) through both debt repayment and EBITDA growth. This is a reduction from the less than 3x previous target that is a positive governance factor,” the agency said in a press release.

The outlook remains stable.

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