Shares of home soda-machine company SodaStream (NASDAQ: SODA) are hitting new 52-week lows, with shares down more than 50% over the past year. SodaStream's growth story has hit a snag, with its push into the United States suffering major setbacks, and a big competitor in the form of Keurig Green Mountain's (NASDAQ: GMCR) upcoming Keurig Cold home carbonation system promises to shake up the market sometime in 2015. Is this just the beginning of SodaStream's decline, or is this decline an opportunity to load up on shares?

Problems in the U.S.
SodaStream's growth story hinges on strong growth in the United States. The company has been selling home carbonation systems in Europe for decades, and in fact sales outside of the United States are still going strong. In the most recent quarter, sales in Western Europe rose by 17% year over year, while sales in the Asia-Pacific region jumped by 28%. But sales in the Americas plummeted by 28%, a massive decline in what is supposed to be SodaStream's most important market.

Part of the problem was excess inventory left over from a tough holiday season. Sales of the company's starter kits, which include a machine as well as some flavors and carbonators to get started, plummeted by 28%. Sales of consumables did far better, rising 15% year over year, and the company still expects to grow total sales by 15% in 2014 despite basically flat revenue during the first quarter. This suggests that the company expects to work through its inventory issues relatively soon.

Serious competition is coming in 2015
Starting next year, SodaStream will have a major competitor to deal with. Earlier this year Coca-Cola and Keurig Green Mountain announced a partnership to bring a competing home carbonation system to market, replete with products from Coca-Cola's extensive portfolio. While SodaStream has partnered with many beverage companies, the major soda companies have been holdouts.

Only about 1% of households in the United States own a SodaStream machine compared to the double-digit rates that the company has achieved in some European companies. This means that the market is still very much up for grabs, and with both Coca-Cola and Keurig having strong, well-known brands, SodaStream has a lot to worry about.

Still a niche market
Home carbonation systems are still a niche market, and I have serious doubts that that will ever change. The problem is that these machines don't actually solve a problem or eliminate an inconvenience. I'll compare a SodaStream to one of Keurig's K-cup coffee machines to illustrate what I mean.

While Keurig's K-cups were once considered a fad, the machines have proven to be extremely popular, with the company selling 1.8 million brewers in the last quarter alone. Using K-cups to make coffee is more expensive than using a traditional coffee machine, but K-cups eliminate the inconvenience of having to measure out ground coffee, an often messy affair. In other words, K-cups solve a problem for consumers, and although they introduce higher costs, millions have chosen convenience over cost.

Home soda makers don't really solve a problem. While it may seem convenient to be able to make soda at home, tacking on soda to a grocery trip and having the drink available immediately instead of having to make it yourself is a far more convenient proposition. Coupled with the fact that SodaStream doesn't begin to save a consumer money compared to buying soda at the store until they drink hundreds of liters, the device lacks a compelling reason to buy it, at least in the United States. Soda prices are higher in many other countries, which helps explain why adoption rates are higher in those countries. But in the United States, SodaStream offers savings for only the heaviest of soda drinkers.

What does all this mean for investors?
Home soda machines remain a niche device, and the low cost of store-bought soda in the United States compared to other countries is working to keep it that way. SodaStream is doing very well in other countries, but the growth story in the United States doesn't seem nearly as compelling. Competition from Keurig should not be ignored, especially since SodaStream's market penetration is so low, and the strength of Coca-Cola's brand may be all it takes to propel the device past SodaStream in the United States.

SodaStream now trades at a P/E ratio of around 17, and the stock is certainly far less expensive than it was in 2013. But SodaStream has no competitive advantage in the United States. It has no double-digit percentage install base like it has in certain European countries, and that will make it all the easier for Keurig to swoop in and steal market share. I just don't see a compelling reason to invest in SodaStream.