Sodastream International Ltd (SODA), Green Mountain Coffee Roasters Inc. (GMCR), Monster Beverage Corp (MNST): Plenty of Growth Left

Monster Beverage Corp (NASDAQ:MNST) revolutionized the energy drink market under the Monster Energy brand. Despite massive competition from other start ups and some of the behemoths in the beverage industry, it has revenue in excess of $2 billion with revenue growth of around 10%. Sodastream International Ltd (NASDAQ:SODA) even competes against Monster, now that it offers energy drinks made via the carbonated soda machines.

With the success of both Monster Beverage Corp (NASDAQ:MNST) and Green Mountain easily exceeding multi-billion revenue levels, the SodaStream target of reaching $1 billion in sales by 2016 appears less and less in doubt due to vast catalysts.

Plenty of catalysts
The roll out of the SodaCaps concept could be a major step forward in growth. This product, in a way, mimics the single-serve concept that made Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR) so successful and revolutionized the coffee industry. Providing consumers the ability to make single-serve sodas could be a killer product that places SodaStream further ahead of mostly non-existent competition.

The other major catalyst would be the potential for vast growth from penetrating the Americas. With a 1% household penetration rate in the US market and no sales from Mexico, SodaStream has years of growth ahead in the two largest soda markets. The company’s revenue for the Americas region only reached $47 million in Q2. This could quickly become a $500 million market based solely on moving the US market penetration rate to 3%. Other regions, such as Europe and Asia, already account for more revenue, and even slow growth could quickly push those regions to $500 million in annual revenue by 2016 if not earlier. Note that the well-established Western Europe region grew revenue year-over-year by 26% during Q2.

Bottom line
Investors need to focus on Sodastream International Ltd (NASDAQ:SODA)’s long-term potential and ignore fears about a war related interruption or the competition. The past experiences of Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR) and Monster Beverage Corp (NASDAQ:MNST), low penetration rates in the lucrative Americas market, and new product innovation such as the SodaCaps should not only lead SodaStream to the $1 billion revenue mark, but also ultimately allow growth way beyond that level.

The article SodaStream: Plenty of Growth Left originally appeared on Fool.com.

Mark Holder and Stone Fox Capital Advisors own shares of SodaStream. The Motley Fool recommends Green Mountain Coffee Roasters, Monster Beverage, and SodaStream. The Motley Fool owns shares of Monster Beverage and SodaStream. 

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