Starbucks Plans Spur SodaStream Slump: Israel Overnight
Stock Chart for SodaStream International Ltd (SODA)
SodaStream International Ltd. (SODA), the Israeli maker of home soda machines, posted the longest stretch of declines in a year on concern Starbucks Corp. (SBUX) will sell a product that will compete with its carbonated drink maker.
The shares fell for a sixth day, declining 1.6 percent to a two week-low of $63.90 in New York. The Bloomberg Israel-US Equity Index of the most-traded Israeli companies in New York rose to the highest level since July 2011. EZchip Semiconductor Ltd. (EZCH), Israel’s second-biggest chipmaker, widened its premium to the Tel Aviv-listed stock to 12 percent. The Israeli stock market was closed over the past two days for a holiday.
Starbucks filed on Sept. 18 an application to register the term Fizzio for a machine that makes beverages, including soft drinks, data from the U.S. Patent and Trademark Office show. SodaStream, which has reported a 42 percent increase in U.S. sales in the second quarter as stores from Wal-Mart Stores Inc. and Staples Inc. retail its products, has slumped 12 percent this quarter, set for its worst three-month decline since 2011.
“Starbucks looks to be targeting the at-home market with the Fizzio,” Nick Setyan, an analyst at Wedbush Securities Inc., said by phone yesterday from Los Angeles. “There should be room for at least one competitor in the SodaStream market.”
The company debuted its products on the QVC home-shopping television network in the second quarter and began selling at 400 Kroger Co. (KR) supermarkets, Chief Executive Officer Daniel Birnbaum, said in a conference call July 31.
SodaStream’s new soda maker models, dishwasher safe bottles, and new beverage mixes in a line that include Kraft Foods Inc.’s Crystal Light and Country Time lemonades, are performing well, Birnbaum said on the call. The company is “confident” in the 2016 target of $1 billion in annual revenue, he said. SodaStream’s sales will rise 30 percent to $566.8 million in 2013, according to the mean of nine analyst estimates compiled by Bloomberg.
Green Mountain Coffee Roasters Inc. (GMCR), the maker of the Keurig single-cup coffee brewer, on July 3 filed an application for a machine that would make still, carbonated, and sparkling beverages, as well as soda.
“Home soda making is still a new category in the U.S. with over 98 percent of homes as potential customers,” Yonah Lloyd, SodaStream’s chief corporate development and communications officer, wrote in an e-mailed message yesterday. “Any legitimate company that enters will help raise awareness, and this is good for SodaStream and all competitors.”
The Bloomberg Israel-US Equity gauge added 0.2 percent to 98.88, extending this month’s advance to 4 percent.
EZchip, the Yokneam, Israel-based maker of network processors, gained 2.3 percent to $25.17, increasing a four-day advance to 13 percent.
Taro Pharmaceutical Industries Ltd. (TARO) surged 5.8 percent to a record $73.80. The Israeli medical treatment company that hit a decade high this month will continue to rise on prospects revenue growth will beat estimates, Credit Suisse Group AG said in a note to clients this week.
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