Deutsche Bank bumps up target price on Fevertree Drinks

(Sharecast News) - Deutsche Bank lifted its target price on Fevertree Drinks from 870p to 900p, but kept its 'hold' rating on the stock, saying the mixer brand faces a tougher backdrop in the US as premium spirits trends soften and readytodrink cocktails continue to reshape drinking habits.

The German bank noted that US premiumspirits value fell 3.2% in 2025, a sharper drop than the wider spirits category, eroding what has historically been a key tailwind for Fevertree.

Moderation, it said, has increasingly favoured premixed convenience, with alcoholic RTDs growing 11% annually between 2019 and 2025 while conventional spirits volumes were flat - a shift that bypasses the mixer purchase entirely.

Deutsche Bank sees the clearest US opportunity in around 125,000 relevant ontrade outlets, mirroring Fevertree's UK strategy of expanding beyond premium venues. Better offtrade execution should also help, though sustaining momentum may require heavier marketing investment.

Convenience channels add roughly 100,000 potential outlets, but DB said the segment's $11.60 average basket and the dominance of energy and sports drinks - which make up 46% of packagedbeverage sales - make it a challenging fit for Fevertree's premium positioning.

Deutsche said the longterm US opportunity remains intact but requires patience, with the shares fairly valued at present despite the targetprice upgrade.

Reporting by Iain Gilbert at Sharecast.com