Why SodaStream's Looking Fizzier This Year

As we approach the halfway point for 2012, now's a good time to look back at what's happening with the stocks that interest you. By making sure you know the important things that a company accomplished -- as well as the setbacks it experienced -- you can make a better decision about whether it's a smart investment for your portfolio.

Today, let's take a look at SodaStream (Nasdaq: SODA  ) . The company behind home water carbonators has seen some amazing growth in recent years, but the pressure is on for the company to demonstrate that it has a lasting competitive advantage and won't merely be a passing fad. Let's take a quick look at how the stock is doing so far this year.

Stats on SodaStream

2012 YTD Return 17.0%
Market Capitalization $771 million
Revenue, Most Recent Quarter $87.9 million
Year-Over-Year Revenue Growth, Most Recent Quarter 50.2%
Net Income, Most Recent Quarter $10.1 million
Year-Over-Year Net Income Growth, Most Recent Quarter 84.3%
CAPS Rating (out of 5) **

Source: S&P Capital IQ, company reports.

Why's SodaStream bubblier in 2012?
Last year, SodaStream's stock got way ahead of itself, more than doubling between the end of 2010 and last summer before giving back all those gains on concerns about a slowing pace of growth. Yet the company has been making moves to boost sales, with retail partnerships with Staples (Nasdaq: SPLS  ) and Target ramping up this year, and a brand-new arrangement with Wal-Mart (NYSE: WMT  ) is already bearing fruit after just a few weeks.

Investors had lumped SodaStream in with coffee-machine maker Green Mountain Coffee Roasters (Nasdaq: GMCR  ) , which plunged last year due to increased competition and a slowdown in growth. But even though there are some similarities between the two companies -- both make machines that require ongoing purchases of products to run them -- the soda-maker has finally managed to step out of Green Mountain's shadow and stand on its own.

Recently, SodaStream has returned to its winning ways. In its most recent quarter, the company saw a big sales surge, including a near-doubling of revenue from North and South America. A big rise in sales of consumables like carbonator refills and soda flavoring points to greater use among owners.

Now, big drink companies are taking notice. Coca-Cola (NYSE: KO  ) recently sent a cease-and-desist letter to SodaStream over the use of empty Coke bottles in promotional exhibits demonstrating the amount of waste a SodaStream machine can prevent. SodaStream is defying the request, having brought an exhibit to Atlanta, where Coke is headquartered.

SodaStream has plenty of potential, but it's definitely not a sure thing. If you'd prefer some other stock ideas with longer track records of success, let me invite you to learn about three smart long-term stock plays in the Fool's latest special report. It's yours for the taking and is absolutely free, but don't miss out -- click here and read it today.

Click here to add SodaStream to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.

Fool contributor Dan Caplinger doesn't own shares of the companies mentioned. The Motley Fool owns shares of Staples, SodaStream, and Coca-Cola. Motley Fool newsletter services have recommended buying shares of Green Mountain Coffee Roasters, Coca-Cola, Staples, and SodaStream, as well as creating a lurking gator position in Green Mountain and a diagonal call position in Wal-Mart. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool has a disclosure policy.

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Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On June 29, 2012, at 3:41 PM, cruzn59 wrote:

    Motley Fool has to mention Green Mountain everyday with Sodastream in a negative light and it is essentially the same message in the same language. Please give us valuable information when it changes but the same data over and over just grabs a link and wastes our time.

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Related Tickers

10/24/2016 4:00 PM
SODA $24.34 Up +0.30 +1.25%
SodaStream CAPS Rating: **
GMCR.DL $0.00 Down +0.00 +0.00%
Keurig Green Mount… CAPS Rating: **
KO $42.56 Up +0.43 +1.02%
Coca-Cola CAPS Rating: ****
SPLS $7.54 Down +0.00 +0.00%
Staples CAPS Rating: **
WMT $69.19 Up +0.85 +1.24%
Wal-Mart Stores CAPS Rating: ***