Login to your account

Lost your password?

These stocks doubled in 2016: They will double again in 2017

SodaStream (SODA)

On the stock market, overhyped companies get exactly one chance to make it. If they don’t deliver, investors bail out, the stock crashes, and the investment pundits find something else to talk about. And yet… SodaStream was hyped in 2013, condemned in 2014, and all but forgotten in 2015. Then, a few significant things happened, including the catastrophic failure of Keurig Green Mountain’s (GMCR) Keurig Cold machine, which many people believed would cut deeply into SodaStream’s sales by allowing people to make Coca-Cola (KO) products at home. Also, in May of 2016, SodaStream announced that it would sell a unique concentrate that could be mixed with its carbonated water to make beer.

The beer announcement refocused a lot of attention on SODA stock, but the company’s revived earnings and revenue would certainly have done that before much longer anyway. Not only did SODA shares rise by 150% in 2016, but the company’s profit margin expanded from 2% to 7%. Even now, the trailing P/E is 26.42—almost exactly the same as the broad market. With SodaStream growing so much faster, that’s a little nuts.

And check out the beautiful J-curve forming in that chart! (Sorry—once a year or so I make a reference to the 100% non-predictive precepts of technical analysis.)


Chart courtesy of www.stockcharts.com

Symbols: , , , ,

Julian Close

Julian Close became a stockbroker in 1995. In his 20 years of market experience, he has seen all market conditions and written about every aspect of investing. Julian has also written extensively on corporate best practices and even written reports for the United Nations. He graduated from Davidson College in 1993 and received a Master of Arts in Teaching from Mary Baldwin College in 2011. You can see closing trades for all Julian's long and short positions and track his long term performance via twitter: @JulianClose_MIC.