Please ensure Javascript is enabled for purposes of website accessibility

Why SodaStream Stock Rose 13.5% in March

By Demitri Kalogeropoulos – Apr 6, 2018 at 10:17AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Investors are feeling more confident about the beverage machine maker's sparkling profit outlook.

What happened

SodaStream (SODA) beat the market last month by gaining 13.5% compared to a 3% decrease in the S&P 500, according to data provided by S&P Global Market Intelligence.

SODA Chart

SODA data by YCharts.

That boost added to a big rally for shareholders, who have seen their stock rise nearly 400% in the past three years.

So what

Investors pushed shares higher last month as they continued to digest SodaStream's latest operating trends. The at-home beverage maker announced an impressive growth spike back in February that also helped drive higher profit margins.

Sparkling soda in a glass with ice and a slice of lime on the rim

Image source: Getty Images.

In a more detailed report filed in late March, SodaStream revealed other positive news about the business, including the fact that machine sales jumped 24% in 2017 to reach 3.7 million units, up from 2.9 million a year ago.

Now what

SodaStream is expecting overall sales growth to tick down to about 12% this year from 14% in 2017. However, investors have a few good reasons to expect significantly higher profits.

First, selling prices on its machines are rising thanks to innovative launches like a new one-touch machine hitting store shelves right now. Second, the company should start logging more high-margin carbon dioxide canister refill sales since these purchases tend to lag machine sales by a few months. That bright earnings outlook could support continued gains in the stock, assuming sales growth keeps meeting management's targets.

Demitrios Kalogeropoulos has no position in any of the stocks mentioned. The Motley Fool owns shares of SodaStream. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

SodaStream International Ltd. Stock Quote
SodaStream International Ltd.
SODA

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
327%
 
S&P 500 Returns
105%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/27/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.