SodaStream (SODA) Pops After Winning Over a New Bull
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Price: $143.68 --0%
Rating Summary:
3 Buy, 13 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 11 | New: 14
Rating Summary:
3 Buy, 13 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 11 | New: 14
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SodaStream International Ltd. (Nasdaq: SODA) is one of the few bright spots Tuesday after picking up a new bull.
JPMorgan upgraded the maker of beverage carbonation systems from Neutral to Overweight with a $50 price target, suggesting 40 percent upside from Friday's close.
The upgrade follows the 48 percent drop following Q1 results and disappointing full year guidance. With the underperformance, shares are now too cheap the firm argues.
Analyst John Faucher said, "While the stock has obviously lost momentum, we
continue to believe that the short to medium term growth potential for SODA is strong and that their 2H guidance will prove to be too conservative."
The multiple on SodaStream has compressed from roughly 40x down to about 19x, 17x ex-cash, Faucher mentions. Also, the guidance seems "overly conservative" he notes.
Making the case for conservative guidance, Faucher notes that the company implied top line growth of nearly 31% for Q311, but only 10% growth YOY in Q4. Even with tough comps in Q4, total U.S. door count at this point has grown by +86%. He thinks guidance will to be too conservative and they expect the test in mass (and a potential full roll-out) to provide upside to Q4 numbers. He sees 16% revenue growth for Q4, but says this estimate could be too low.
Shares of SodaStream are up 4.4 percent today to $37.16.
For more ratings news on SodaStream International click here and for the rating history of SodaStream International click here.
JPMorgan upgraded the maker of beverage carbonation systems from Neutral to Overweight with a $50 price target, suggesting 40 percent upside from Friday's close.
The upgrade follows the 48 percent drop following Q1 results and disappointing full year guidance. With the underperformance, shares are now too cheap the firm argues.
Analyst John Faucher said, "While the stock has obviously lost momentum, we
continue to believe that the short to medium term growth potential for SODA is strong and that their 2H guidance will prove to be too conservative."
The multiple on SodaStream has compressed from roughly 40x down to about 19x, 17x ex-cash, Faucher mentions. Also, the guidance seems "overly conservative" he notes.
Making the case for conservative guidance, Faucher notes that the company implied top line growth of nearly 31% for Q311, but only 10% growth YOY in Q4. Even with tough comps in Q4, total U.S. door count at this point has grown by +86%. He thinks guidance will to be too conservative and they expect the test in mass (and a potential full roll-out) to provide upside to Q4 numbers. He sees 16% revenue growth for Q4, but says this estimate could be too low.
Shares of SodaStream are up 4.4 percent today to $37.16.
For more ratings news on SodaStream International click here and for the rating history of SodaStream International click here.
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