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SodaStream (SODA) Beats on Earning; Misses Sales in Q4

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SodaStream International Ltd. (SODA) makes beverage carbonation systems which transforms tap water into soft drinks and sparkling water. SodaStream’s products are primarily sold at major retail stores like Kohl’s, Corp, Macy’s and Bed Bath & Beyond.

 

SodaStream has been reporting soft sales in the U.S. over the past few quarters due to low demand for its products — soda machines and flavored syrups.  The carbonated soft drink (CSD) market is going through a tough time in the U.S. as consumers are shifting away from traditional soda toward more natural, less caloric and water-based beverages. In keeping with the changing trend, SodaStream has already shifted toward health and wellness brands and is making significant changes in its growth strategies as well.

 

Investors should also note the recent earnings estimate revisions for SODA, as the consensus estimate has been moving lower. However, SODA does have a decent history in earnings season. SODA has delivered positive earnings surprise in the past three out of two quarters, making for an average positive earnings surprise of 130.7%.

 

Currently, SODA has a Zacks Rank #4 (Sell), but that could definitely change following SodaStream’s earnings report which was just released. We have highlighted some of the key stats from this just-revealed announcement below:

 

Earnings: SODA beat on earnings. Our consensus earnings estimate called for EPS of 20 cents/share, and the company reported EPS of 35 cents instead. Investors should note that these figures take out stock option expenses.

 

Revenues: SODA reported revenues of $126.5 million. This missed our consensus estimate of $142 million.

 

Key Stats to Note: Gross margins improved 800 basis points in the quarter to 50.4% due to lower promotional and discounting expenses than last year.

 

Stock Price: Shares jumped almost 5% in pre-market trading.

 

Check back later for our full write up on this SODA earnings report later!

 

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