CEO of SodaStream (SODA) Talks With Cramer, Reassures Investors
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Rating Summary:
3 Buy, 13 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 0 | Down: 0 | New: 0
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Thursday evening on CNBC’s Mad Money, host Jim Cramer welcomed the CEO of Sodastream (Nasdaq: SODA), Daniel Birnbaum. The exec talked with Cramer about the strengths and weakness of the company's previous quarter and what investors have to look forward to moving forward.
Birnbaum said the U.S. only accounts for about 20 percent of SodaStream's total sales whereas Europe currently makes up a majority of the other 80 percent. This is unusual as the U.S.'s home soda market is much larger than the European market (in fact the biggest in the world), valued at around $40 billion. Coca-Cola (NYCE: CCE) and Pepsi (NYSE: PEP) own a majority of the market share; SodaStream currently controls roughly under a third of a percent of the total market share in the U.S.
SodaStream's profit has doubled over the last three years and sales have experienced an increase of 298 percent year-over-year in its last quarter. Management plans to a increase its advertising in the fourth quarter as it is the company's most profitable quarter.
Looking ahead, Birnbaum showed concern about building the brand name properly and taking the necessary steps in doing so. SodaStream is working with Costco and is testing the sales of the product in a limited number of stores. Birbaum said the company has only been offering a product to the retail market for the last two year.
The product itself has had no problems and has a return rate under 3 percent. It is a cost-saving device, allowing consumers an average 20 percent in savings on a can of soda and 70 percent on a bottle of sparkling water. Over the last year, 80 percent of people who purchased the Sodastream machine actually use it on a regular basis.
Birnbaum took full blame for his performance on the company's latest the conference call. He admitted he could have explained things differently.
Investors must have tuned into Mad Money last night and liked the exec's comments as shares are up 6 percent to around $42.20 in morning trade Friday.
Birnbaum said the U.S. only accounts for about 20 percent of SodaStream's total sales whereas Europe currently makes up a majority of the other 80 percent. This is unusual as the U.S.'s home soda market is much larger than the European market (in fact the biggest in the world), valued at around $40 billion. Coca-Cola (NYCE: CCE) and Pepsi (NYSE: PEP) own a majority of the market share; SodaStream currently controls roughly under a third of a percent of the total market share in the U.S.
SodaStream's profit has doubled over the last three years and sales have experienced an increase of 298 percent year-over-year in its last quarter. Management plans to a increase its advertising in the fourth quarter as it is the company's most profitable quarter.
Looking ahead, Birnbaum showed concern about building the brand name properly and taking the necessary steps in doing so. SodaStream is working with Costco and is testing the sales of the product in a limited number of stores. Birbaum said the company has only been offering a product to the retail market for the last two year.
The product itself has had no problems and has a return rate under 3 percent. It is a cost-saving device, allowing consumers an average 20 percent in savings on a can of soda and 70 percent on a bottle of sparkling water. Over the last year, 80 percent of people who purchased the Sodastream machine actually use it on a regular basis.
Birnbaum took full blame for his performance on the company's latest the conference call. He admitted he could have explained things differently.
Investors must have tuned into Mad Money last night and liked the exec's comments as shares are up 6 percent to around $42.20 in morning trade Friday.
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