NEW YORK (TheStreet) -- With all the talk of a new home soda system from Green Mountain Coffee Roasters (GMCR) and Coca-Cola (KO - Get Report), investors probably missed the news that Dr Pepper Snapple Group (DPS) announced on Thursday that it is raising its quarterly dividend by 8% to 41 cents a share from 38 cents.
While Dr Pepper is much smaller than Coke and Pepsi in revenue, its dividend yield is higher -- Coke's is 2.8%, Pepsi's 2.9% -- and its P-E ratio is 15.5, compared with Coke's 19.7 and Pepsi's 18.6. Dr Pepper also has a lower price-to-sales ratio (1.51) than Coke (3.56) and Pepsi (1.8). And Dr Pepper has increased its dividend annually since 2009.
Among the company's 50 brands are Dr Pepper, Snapple, Sunkist, Squirt and A&W. It has six of the top 10 non-cola soft drinks. Thirteen of the company's top 14 brands hold a No. 1 or No. 2 market position in their categories.While Coke offers growth with its line of non-carbonated drinks and now a stake in Green Mountain Coffee Roasters and Pepsi offers growth from its snack line, which could eventually be spun off into a separate company, Dr Pepper gives investors income and steady earnings. The company continues to cut costs and increase its profit. Value and income investors should consider a trip to the Dr. At the time of publication, the author had no position in any of the stocks mentioned. This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.
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