SodaStream pops on strong outlook

Click the chart to track shares of SodaStream.

SodaStream shares jumped 13% Tuesday, as investors welcomed the company's upbeat outlook and analyst upgrades.

"Our goal is to be a billion dollar company by 2016," said CEO Daniel Birnbaum, at SodaStream's very first analyst meeting. That would nearly double the $550 million the company expects to rake in this year.

The optimistic CEO suggested that he thinks the company could hit the milestone even earlier, as consumers continue to embrace the idea of making their own soda at home.

"They told me not to say that I want to do it earlier, so I'm not saying it," he quipped.

Birnbaum said the company's focus is to increase the number of households it's in. So far, SodaStream machines are in 6.5 million households globally. In the United States, about 1.3 million households have SodaStream machines. But that's only about 1% of total U.S. households, so there's plenty of opportunity to grow.

The lofty outlook prompted analysts to raise their expectations and stock price targets for SodaStream.

Oppenheimer analyst Joseph Altobello, who raised his target on SodaStream (SODA) shares to $68 from $60,  said the company's growth strategy is sustainable and "just getting started."

The SodaStream rally gave traders on StockTwits plenty to chatter about.

 Sliver
$SODA POP from new PT. Excellent! Keep going SODA Stream!

 rrshasss
$SODA price target raised to $66 from $60 at Citigroup

In addition to raising the price target, Citigroup analyst Wendy Nicholson said the company's robust outlook for 2016 gave her enough confidence to also boost her earnings forecast for 2014 and 2015.

Traders also discussed the heavy short interest in SodaStream. Many buyers have borrowed shares of the stock on a bet that its price will fall. But as the stock rallies, short sellers will typically rush in to buy shares and cover their short positions before prices head even higher -- a phenomenon called a short squeeze.

 LDrogen
Never understood why there were so many shorts and haters in $SODA, great razorblade business and saves people money too.

 TraderRL23

$SODA 20.7million shares out. 7 million of those shares are held short......... Squeeze em! Bullish

Posted in: beverage, outlook, soda, SodaStream, stock

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