Is This The Time To Buy Sodastream International Ltd (SODA)?

Things to Look Out For

One of the reasons why a lot of investors feel that SodaStream is not worth investing in is that it might be a fad, and things in the U.S. might not turn out as well as they have in Europe. The sales of the CO2 canisters and syrups will be an important factor to determine whether people are using their soda makers. Pepsi and Coke have been around for decades in the market, and there is no doubt that a lot of people will continue to buy canned and bottled sodas.

When SodaStream first came to the U.S, Wal-Mart Stores, Inc. (NYSE:WMT) wasn’t a distributor of the product, even though sales have since exceeded expectations at Walmart and Bed, Bath & Beyond Inc. (NASDAQ:BBBY). However, the thing to look out for here is the availability of CO2 canisters, which could be one of the major factors deciding SodaStream’s future.

The company is targeting various retail outlets and stores, but the canisters aren’t available everywhere. You can find Pepsi and The Coca-Cola Company (NYSE:KO) sodas just about anywhere, all around the world, but this isn’t the case with SodaStream. Research shows that if it takes more than a 15-minute trip for people to go and buy these canisters, those shoppers will turn back toward Pepsi and Coke.

Bottom Line

If you are thinking of investing in the industry, then SodaStream looks really promising. Pepsi and Coke have been stable stocks, while SodaStream is going through a crazy ride. The growth opportunities for SodaStream are numerous, and another earnings report is due late February. It’s expected to show further improvement; sales have been brilliant during the holiday season, and thousands of products have been sold at various retail outlets.

SodaStream might turn out even better by the end of 2013. However, things might change, and the company could face serious bumps along the way. In the case of Pepsi and Coke, you can buy the stock and wait. However, in the case of SodaStream, you’ll want to closely monitor any investment you make.

The article Is This The Time To Buy SODA? originally appeared on Fool.com and is written by Yasir Idrees.

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