Will SodaStream Be Fizzy or Flat?

SodaStream's (Nasdaq: SODA  ) ready to pour its heart out again.

The company behind the popular beverage system that's taking off worldwide will report its latest quarterly results tomorrow morning.

We know where the analysts are perched. They see revenue and earnings per share climbing 33% and 29%, respectively.

We also know that SodaStream has a spotless record of posting impressive bottom-line results. Since going public at $20 two years ago, the Israeli company has beaten Wall Street's profit targets every single quarter.

To be honest, it hasn't even been close. Let's take a look at the past year of positive surprises.

 Quarter

EPS Est.

EPS

Surprise

Q3 2011

$0.34

$0.56

65%

Q4 2011

$0.29

$0.32

10%

Q1 2012

$0.46

$0.55

20%

Q2 2012

$0.46

$0.52

13%

Source: Thomson Reuters.

Unfortunately for SodaStream investors, a sound beat isn't good enough sometimes. The stock took a hit a few quarters ago because the company didn't raise its guidance after an otherwise blowout report. Yes, the market can be that fickle.

It doesn't help that a lot of people are betting against SodaStream. There were a whopping 8.5 million shares sold short as of mid-October. It would take 16.5 days to cover those positions given the stock's average daily volume.

Naysayers are drawn to bearishness given the fickle nature of small trendy appliances. They've seen Margaritaville blenders and Foreman grills come and go. However, SodaStream has some real value, environmental, and convenience benefits over traditional soda consumption.

SodaStream is also lining up some worthy partners.

Wal-Mart (NYSE: WMT  ) finally began stocking SodaStream in May, making this the first full quarter of availability at the world's largest retailer. This was also the first full quarter that Kraft Foods (Nasdaq: KRFT  ) had its Crystal Light diet drinks and Country Time lemonade available as co-branded flavors for SodaStream's system.

The future will be interesting. Cuisinart will introduce its own sparkling beverage maker this month, and yesterday it announced a deal with Primo Water (Nasdaq: PRMW  ) to breathe new life into the bottled water distributor's seemingly dead Flavorstation platform.

Investors will be hoping for another bottom-line beat, but the importance of issuing an upbeat outlook has never been greater.

Drink up
SodaStream is blazing as a consumer-facing growth stock, and it offers an intriguing opportunity for growth that may be harder to duplicate than you might think. Our premium report on SodaStream explains the opportunities as well as the risks in the company, and addresses whether Sodastream is a buy. The report comes with a year's worth of updates, so just click here to check it out now.


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