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Primo Water Corp

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Morningstar Rating for Stocks Fair Value Economic Moat Capital Allocation

No-Moat Primo Water Faces Challenges to Expand Margins in Commoditized Water Aisle

Business Strategy and Outlook

As a pure-play water provider, Primo Water has built a solid product portfolio and manufacturing and distribution footprint to tap rising demand for better-quality drinking water in North America and Europe. However, we remain skeptical that the firm benefits from any durable competitive edge based on brand intangibles or cost advantages, given the lack of differentiation and intense local competition in the water category. As such, we have assigned a no-moat rating to the firm.

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