Fever-Tree Stock Jumps After Kepler Upgrade Cites U.S. Growth

Shares of Fevertree Drinks PLC (LON:FEVR) jumped on Tuesday after Kepler Cheuvreux upgraded the stock to "Buy" from "Hold," citing an attractive entry point following a recent price decline and accelerating growth in the key U.S. market.

The stock rose 4.2% to 828 pence in morning trading, significantly outperforming the broader FTSE Mid-Cap 250 index, which was down approximately 0.4%, according to the report.

Details of the Upgrade

Kepler Cheuvreux raised its price target on Fever-Tree to 910 pence from a previous 900 pence, implying a potential upside of about 14.5% from its reference price. The broker stated that the recent pullback in the share price presented a favorable opportunity for investors.

The core of the upgrade rests on the view that Fever-Tree is entering a stronger phase of growth and earnings. Analysts highlighted accelerating momentum in the United States, where a partnership with Molson Coors is enhancing distribution, marketing, and in-store merchandising.

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Rationale and Outlook

Kepler's analysis pointed to several key factors supporting its optimistic outlook:

• U.S. Acceleration: Off-trade growth in the U.S. improved to 16% in July-August, a significant increase from 6% in the first quarter of 2026.
• Market Stabilization: The company's core UK market has stabilized and is no longer considered a drag on overall growth.
• Product Diversification: Non-tonic products now represent 32% of sales, providing an additional avenue for expansion beyond the core tonic water business.
• Profit Protection: Analysts see greater downside protection for earnings before interest, taxes, depreciation, and amortization (EBITDA), thanks to the company's input-cost hedging and a profit guarantee with Molson Coors.

Following its analysis, Kepler raised its adjusted EBITDA estimates for Fever-Tree by 5.8% for 2026 and 8.5% for 2027. The upgrade comes after Fever-Tree recently reported a 14% rise in first-half revenue and a 30% increase in pretax profit. Confidence was further bolstered by a recent regulatory filing showing the company's chair purchased approximately £348,000 worth of shares.