Tuesday, June 10, 2014

Recent Buy-Dr. Pepper Snapple (DPS)

I added 2.56 shares of DPS on 6/10/14 at $58.56 per share.

After doing some research with Loyal 3, I finally decided to give it a try. I'm going to start off with a small purchase because their are no trading fees so I am able to buy for as little as $10. I'm going to aim for a small purchase every week into some of the better dividend growth stocks they offer. Loyal 3 currently only offers about 55 stocks for your choosing. Although this does limit me a little bit with building a diversified account, I did notice they offer some pretty good companies. I will now have two portfolios and will be contributing to both. My other account is with Sharebuilder which offers a $6.95 trading fee. I will be keeping Sharebuilder for the bigger purchases, and will be able to invest into companies that Loyal 3 does not offer. So why did I start with investing into Dr. Pepper Snapple Group with my new brokerage account? 

  • DPS has a current P/E of 17.62 and an attractive dividend yield at 2.8%.
  • Dr. Pepper is the next best selling carbonated soft drink after Coke. 3rd best selling in the U.K.
  • DPS is finding new areas to distribute their products and will probably be in every Mcdonalds restaurant by the end of the year.
  • Many consumers will only drink Dr. Pepper compared to the other generic brands that simply don't taste the same. This leaves Dr. Pepper with a mini monopoly on this type of drink. 
  • Quarter one was a profit for DPS and continues to be on a run. 
  • A&W, Sunkist, 7up, Dr. Pepper, IBC, Stewart's, Welch's, Yoo-hoo, Snapple, Crush, Squirt & Country Time Lemonade are among their US brands.
  • Priced cheap compared to its peers, Coke and Pepsi.
  • Dr. Pepper is the oldest soft drink in America.
  • Dr Pepper Snapple Group holds a unique portfolio of strong brands with leadership positions in various beverage markets.
In the coming weeks I will write about my experience with Loyal 3. I will also be updating my portfolio page this week because I now have two portfolios to keep track of. Does anyone else have an account with Loyal 3? Do you think DPS is a good buy at this time?


  1. I use Loyal3 as well, I like it because in months where I don't have enough money to make a purchase in one of my brokerage accounts with a $8 commission, I can still invest a small amount, with no fees.
    I've never really researched DPS but judging by a quick look at the current numbers over at Guru Focus, it seems the stock is trading at a fair valuation. The dividend growth and share buyback rates are impressive. I'll have to do more research into it and maybe I'll join you as a fellow shareholder soon.

  2. Hey SFZ,
    I like how I can use buy $50 worth of shares with my credit card. The transaction goes through one day earlier than a banking transaction. Granted this isn't a lot to invest at once but I am totally fine with making multiple $50 purchases throughout the month. Do you know if the dividends are automatically reinvested to buy more shares or do you get the cash in your account with Loyal3? Thanks for stopping by!

  3. Hi DM:

    I have a Loyal3 account and can shed some light to your question. Unless the stock has the triple heart icon next to it, the dividends will not be reinvested. Instead, the dividends will be placed in your cash account which you can use to buy more stocks or request the dividends transferred to your linked checking account.

    Warning: Unless you transfer the dividends out, the cash (dividends) in your account will be used to offset your next automatic purchase for any stock. For example, if you receive a $5.00 dividend from your DPS holding and you have an automatic purchase of $50.00 coming soon, the $5.00 will be applied to the automatic purchase and your credit card will be charged $45.00 versus your prescheduled $50.00.