Sodastream International Ltd (NASDAQ:SODA) experienced a 17% stock plunge in New York as it struggles to keep its promise.
The company had vowed to reinvent itself as a health-conscious manufacturer of sparkling-water machines, but investors seem to be responding in a different way. The firm took a huge hit this time with a 17% stock drop on the New York Stock Exchange. Especially compared to the minimal 2.1% drop that was registered in Standard & Poor’s 500 Index over the same period.
The stock plunged for 11 consecutive days before finally going up on Friday. The firm has been hard at work trying to cultivate success in the United States to reach the same level experienced in the European region. The company had attempted to make an entry with a brand aimed to compete with energy drinks from The Coca-Cola Co (NYSE:KO) and PepsiCo, Inc. (NYSE:PEP). Unfortunately, the plan was not in line with the shifting consumer preference where consumers are looking for healthier alternatives.
Steven Schoenfeld, from BlueStar Global Investors LLC, said that the market had built up a lot of expectations for the market. Unfortunately, there was a lot of disappointment when the company failed to successfully execute its plans in the American market. The firm was unable to reach the $100.9 million sales estimate set by analysts in the first quarter. The actual sales amounted to $90.3 million. In the previous year, SodaStream had managed to make sales worth $118.2 million within the first quarter.
Sodastream International Ltd (NASDAQ:SODA) officials claim that the low demand for carbonated water and the foreign currency fluctuations have a lot to do with the share decline. The company has been trying to reverse the deteriorating state of the business since last year amidst new startups in the market. SodaStream Chief Executive, however, stated that the firm does not expect a lot of competition especially from newcomers such as the Keurig Kold machine. The company’s U.S. officials have not revealed further details about the company’s plans for the future.
This report is for information purposes only, and is neither a solicitation or recommendation to buy nor an offer to sell securities. Financials Trend is not-a-registered-investment-advisor. Financials Trend is not a broker-dealer. Information, opinions and analysis contained herein are based on sources believed to be reliable, but no representation, expressed or implied, is made as to its accuracy, completeness or correctness. The opinions contained herein reflect our current judgment and are subject to change without notice. Financials Trend accepts no liability for any losses arising from an investor's reliance on the use of this material. Financials Trend sometimes gets compensated up to one hundred and fifty thousand dollars per month for featuring particular stocks. See site disclaimer for complete compensation. Financials Trend and its affiliates or officers currently hold no shares of these stocks. Financials Trend and its affiliates or officers will purchase and sell shares of common stock of these stocks, in the open market at any time without notice. Financials Trend will not update its purchases and sales of these stocks in any future postings on Financials Trend's websites. Certain information included herein is forward-looking within the context of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements concerning manufacturing, marketing, growth, and expansion. The words "may", "would," "will," "expect," "estimate," "anticipate," "believe," "intend," " project," and similar expressions and variations thereof are intended to identify for ward-looking statements. Such forward- looking information involves important risks and uncertainties that could affect actual results and cause them to differ materially from expectations expressed herein. *Financials Trend does not set price targets on securities. Never invest into a stock discussed on this web site or in this email alert unless you can afford to lose your entire investment.