SodaStream, Sunny Delight Beverages Team Up - Analyst Blog


SodaStream International, Ltd. ( SODA ) has entered into a strategic alliance with Sunny Delight Beverages Co., a leading juice-based beverage company.

The companies will develop new flavors under the Sunny D brand, such as SunnyD Tangy Original Orange, Orange-Strawberry and other flavors. These products will be made exclusively for the SodaStream home beverage carbonation systems and are expected to hit U.S. markets from the second half of 2014

SodaStream International's soda making systems, sold under the SodaStream brand, offer a healthier way to enjoy carbonated beverages at home. SodaStream's products are primarily sold at retailers like Kohl's Corp. ( KSS ), Macy's, Inc. ( M ) and Bed Bath & Beyond, Inc. ( BBBY ).

Sodastream, a leading maker of beverage carbonation systems for homes, has been collaborating with other companies to create new flavors that can be used in its home carbonation systems and thus boost its sales. Last month, the company formed a strategic alliance with Skinnygirl, a lifestyle company created by Bethenny Frankel, an author, chef, TV personality and entrepreneur. Per the alliance, the companies will develop new flavors that are low in calorie, naturally sweetened, especially for women. These flavors offered under the Skinnygirl brand are to be used in SodaStream home carbonation systems.

Last week Sodastream reported fourth-quarter 2013 earnings of 3 cents per share, surpassing the Zacks Consensus Estimate of 1 cent by 200%.  However, the estimate took into account management's warning last month about the fourth quarter being much more challenging than expected.

Fourth-quarter 2013 total revenue of $168.1 million increased 26.4% year over year and beat the Zacks Consensus Estimate of $167 million. Though the top line held up relatively well, the soda machine maker's fourth-quarter bottom-line performance was below expectations. The failure to achieve the desired margins due to pricing and cost headwinds during the holiday season led to the soft results. SodaStream expects some of the headwinds seen in the second half of 2013 to continue into the first half of 2014.

SodaStream International carries a Zacks Rank #5 (Strong Sell).

BED BATH&BEYOND (BBBY): Free Stock Analysis Report

KOHLS CORP (KSS): Free Stock Analysis Report

MACYS INC (M): Free Stock Analysis Report

SODASTREAM INTL (SODA): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: BBBY , KSS , M , SODA

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