Oakmark Funds, a long-term value investment management firm, published its “Oakmark Global Fund” fourth quarter 2020 investor letter – a copy of which can be seen here. A return of 29.45% was recorded by the fund in the fourth quarter of 2020, outperforming both its MSCI World benchmark that had a 14.0% gain, and its Lipper Global Fund Index that delivered a 16.2% return in the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.
Oakmark Global Fund, in their Q4 2020 investor letter, mentioned Keurig Dr Pepper Inc. (NASDAQ: KDP) and emphasized their views on the company. Keurig Dr Pepper Inc. is a Plano, Texas-based soft drink company that currently has a $49.6 billion market capitalization. Since the beginning of the year, KDP delivered a 10.13% return, extending its 12-month gains to 44.54%. As of March 26, 2021, the stock closed at $35.24 per share.
Here is what Oakmark Global Fund has to say about Keurig Dr Pepper Inc. in their Q4 2020 investor letter:
“Keurig Dr Pepper is one of North America’s leading beverage companies and commands dominant positions in single-serve coffee and flavored sodas. We believe single-serve coffee pods will capture almost all of the incremental growth in at-home coffee consumption. Many consumers find that K-Cups offer better convenience, quality, variety and value, compared to drip brewing. Keurig’s competitive advantages (low-cost production, the largest installed base of brewers, exclusive brand partnerships) allow it to collect a toll on most pods sold in North America. The company’s soda franchises remain highly profitable, and we do not expect health-related concerns about sugar to materially impact consumption trends. We believe that Keurig’s brands should deliver steady growth, consistent market share gains and significant excess cash. We think the company is an above-average business trading at a meaningful discount to the broader market, its beverage peers and historical private market transactions.”
Our calculations show that Keurig Dr Pepper Inc. (NASDAQ: KDP) does not belong in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the fourth quarter of 2020, Keurig Dr Pepper Inc. was in 29 hedge fund portfolios, compared to 41 funds in the third quarter. KDP delivered a 10.54% return in the past 3 months.