The ratings on Plano, Texas-based Dr Pepper Snapple Group Inc. (DPS) reflect its position as the third-largest soft drink company in North America, its good brand recognition, and cash flow generation. However, DPS' significant debt levels, narrow business focus, and the challenging industry conditions in the mature and low-growth markets in which it competes offset these positives. DPS is a leading integrated brand owner, bottler, and distributor of nonalcoholic beverages in the U.S., Canada, Mexico, and the Caribbean. In 2008, U.S. sales represented 89% of total sales. Although the company has a diverse portfolio of flavored (non-cola) carbonated soft drinks (CSDs) and noncarbonated soft drinks (non-CSDs; including ready-to-drink teas, juices, juice drinks, and mixers), we believe that CSDs account for
