NEW YORK (TheStreet) -- SodaStream International (SODA) , the home soda-machine maker, has lost more than 35% of its value year to date. Will its stock continue to fall or does the company have a silver lining?
The main factor that could turn the company's stock around is a potential buyout down the line. In the past year, SodaStream shares soared on speculations of a potential buyout by Coca-Cola (KO) and PepsiCo (PEP) . For now, these speculations have died down. But if another potential deal were to rise, this could pull back up the company's valuation.Read More: Warren Buffett's Top 10 Dividend Stocks
Without a buyout, it seems the company will keep losing ground. In the recent earnings report, the company revised down its 2014 guidance: Its revenue will rise by only 5% and not 15% as estimated earlier. The company continues to show lower profit margin and failed to expand its reach in North America.
Earlier this month Soros Fund Management, founded by George Soros, sold its stake in the Israeli company without providing any reasoning behind this decision.
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In terms of valuation, SodaStream's current stock price isn't a bargain either. Its current valuation is high and its price-to-earnings ratio is 24.5. Coca-Cola and PepsiCo have a lower P/E of 22.1 and 20.8, respectively.
SodaStream's enterprise value (market capitalization plus debt minus cash)-to-EBITDA (earnings before interest, taxes, depreciation and amortization) ratio is 14.15. PepsiCo is 12.64. Coca-Cola's is 15.12. By this measure, SodaStream's stock is high compared to PepsiCo.