On April 14, SodaStream (Nasdaq: SODA) registered for a proposed follow-on public offering, putting 5 million shares up for sale at an aggregate price of $261 million. That's good news if you're one of the insiders who unloaded stock in the secondary. Only 20% of the proceeds raised will go to the company. Pre-IPO investors accounted for a whopping 80% of stock offered in the deal.

Fortissimo Capital Fund, SodaStream's largest investor, reduced its share of SodaStream from 28% to as low as 15%. Fortissimo is a private equity firm that provides "growth equity capital to facilitate expansion."

Don't you wonder what Fortissimo thinks about the expansion that bulls are counting on to propel the stock higher?

That's not the only reason for concern about the much-anticipated expansion. SodaStream plans to use the $52 million it raised in the secondary for general corporate purposes, including possibly acquisitions or investments in complementary companies or products. It will need substantial growth to justify its 42 P/E ratio.

Part of SodaStream's valuation is likely due to investors chasing the next Green Mountain Coffee Roasters (Nasdaq: GMCR). There are similarities. Both companies' products are being touted at well-known retailers Amazon, Bed Bath & Beyond, and Williams-Sonoma. Both employ a razor-and-blades model, with the real profits coming from high-margin cartridges. SodaStream's contain either carbon dioxide (for carbonating water) or private-label soda flavorings.

But SodaStream's cartridge model looks to have more margin risk than Green Mountain's. The latter's margins already reflect the impact of selling K-cups containing brand names such as Dunkin' Donuts. If SodaStream offers cartridges containing flavorings from a soda heavyweight such as Coca-Cola (NYSE: KO) or PepsiCo (NYSE: PEP), it seems to me that would pressure margins, although it might quickly increase sales, too.

Foolish takeaway
Fortissimo's sale and the rich P/E suggest there is risk to the bull case. With EPS growth of only 21% in 2010 and just 11% in 2011, some may see the stock as richly valued. Investors may want to follow Fortissimo's lead and take at least some profits now.

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