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SodaStream (SODA) at a 52-Week High on Strong Q3 Results

SODA BBBY M KSS

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On Nov 14, shares of SodaStream International Ltd. (SODA - Free Report) rallied to a 52-week high of $34.16. The stock pulled back to end the trading session at $32.80. The Israel-based manufacturer of home beverage carbonation systems has a market cap of around $692.2 million and has seen its shares rise roughly 105.5% so far this year as against a 7.5% increase for the S&P 500 over the same period.

What’s Driving SodaStream?

Recently, the company reported impressive third-quarter 2016 results, beating the Zacks Consensus Estimate on both counts. The company’s adjusted earnings of 69 cents per share crushed the Zacks Consensus Estimate of 24 cents by 187.5%. Earnings increased a robust 213.6% on a year-over-year basis as well.

Total revenue of $124.2 million beat the Zacks Consensus Estimate of $117.7 million by 5.5%. Sales rose 12.9% year over year on increased demand for sparkling water makers and consumables mainly in Germany, Japan, Australia, the Nordics, the U.S. and Canada.

The top-line increase was supported by repositioning of the SodaStream brand around sparkling water coupled with effective marketing programs aimed at increasing household penetration. Notably, SodaStream has reported three consecutive quarters of double-digit revenue growth.

The growing popularity of sparkling water is driving this rally, as SodaStream’s cost effective beverage carbonation systems help consumers transform ordinary tap water into soft drinks and sparkling water easily. Sparkling water maker unit sales rose 23% to 788,000 in the third quarter.

Also, during the third quarter, the company’s home carbonation system was used to produce more sparkling water than any other brand worldwide, which resulted in a quarterly record of 7.7 million gas refills. SodaStream’s products are primarily sold at major retail stores like Kohl’s, Corp. (KSS - Free Report) , Macy’s, Inc. (M - Free Report) and Bed Bath & Beyond, Inc. (BBBY - Free Report) .

SODASTREAM INTL Price and Consensus
 

SodaStream sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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