This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

10 Stocks With Huge Rebound Potential

Stocks in this article: NILE SODA GS PAL SINA SOHU BIDU YOKU CYOU DANG

SodaStream International

Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

Another beaten-down stock with a huge short interest is SodaStream International (SODA), which, along with its subsidiaries, is engaged in developing, manufacturing and marketing home beverage carbonation systems and related products. This stock is actually up in the last three months by 26%, and for the full year it's up by over 66%. That said, over the past couple of weeks, SodaStream has dropped from its 52-week high of $63.20 to its current price of close to $52 a share.

This company has a market cap of $1.05 billion and an enterprise value of $987 million. It's a high-growth stock that trades at a premium multiple of 53 times trailing earnings and 39 times forward earnings. SodaStream is forecasted to growth its earnings over the next five years at over 33%, which again is why this stock fetches such a high multiple.

Lots of traders are concerned that SodaStream could turn into a fad stock, but when the company is seeing its revenue and adjusted earnings grow by 50% and 141%, respectively, in its latest quarter, it's hard to slap that kind of label on the stock so quickly. As long as SodaStream can continue to penetrate the home market with cheap soda-making machines, then you're going to see sales continue to skyrocket.

Over the last two quarters, SodaStream has sold 1.3 million of its popular home soda-making starter kids. The company estimates that it has 4.5 million active customers who use its product. That tells me that SODA is still very early into its grow story when you consider how much more penetration into the U.S. market -- 307 million people -- is possible.

From a technical standpoint, SODA has pulled back in the last few weeks very close to its 50-day moving average of $50.02. I would look to buy this stock any weakness as long as it holds above that 50-day and you don't see any expansion of volume selling through that level. Add to this position aggressively if SODA takes out some near-term resistance at $55 a share.

The current short interest as a percentage of the float for SODA is a huge 45.4%. The bears have also been increasing their bets from the last reporting period by 14.5%, or by around 506,866 shares. If this company continues to execute on their growth strategy, then the short-sellers here are in for a world of hurt. This one you have to watch in case we see a market rebound, because it will soar if we do.

3 of 6

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs