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SodaStream (SODA) Beats on Q1 Earnings; Shares Jump

SodaStream International Ltd. SODA makes beverage carbonation systems which transforms tap water into soft drinks and sparkling water. SodaStream’s products are primarily sold at major retail stores like Kohl’s, Corp, Macy’s and Bed Bath & Beyond.

The company’s sales figures have been weak in over the past few quarters due to low demand for its products — soda/sparkling water machines and flavored syrups. The carbonated soft drink market is facing troubles as consumers are shifting away from traditional soda toward more natural, water-based beverages containing fewer calories.

Keeping in line with this, SodaStream is pursuing a global restructuring and growth plan. The company is repositioning itself as a water-based brand under a health and wellness plan and making significant changes in its growth strategies to boost business.

As part of the plan, the company rolled out a range of natural water-enhanced flavors in the U.S. and some international markets last year. Also, the company is working on the transformation of its manufacturing base and operating structure – which includes consolidating production under the new Lehavim facility in Southern Israel and closing other legacy facilities – to enhance efficiency.

Investors should also note that SODA has not seen any major earnings estimate revision for some time. However, the stock does have a decent history in earnings season. SODA delivered positive earnings surprise in three out of the past four quarters, bringing the average positive earnings surprise to 138.45%.

Currently, SODA has a Zacks Rank #3 (Hold), but that could definitely change following SodaStream’s earnings report which was just released. We have highlighted some of the key stats from this just-revealed announcement below:

Earnings: SODA beat earnings. Our consensus earnings estimate called for EPS of 15 cents/share, and the company reported EPS of 29 cents instead. Investors should note that these figures take out stock option expenses.

Revenues: SODA reported revenues of $100.9 million. This beat our consensus estimate of $89 million.

Key Stats to Note: Adjusted EBITDA was $12.3 million, up 61.7% year over year. Operating margins rose 390 bps to 7.9%.

Stock Price: Shares rose a massive 11.2% during pre-market trading.

Check back later for our full write up on this SODA earnings report later!

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