Canaccord analyst Scott Van Winkle weighed in with a few insights on Sodastream International Ltd (NASDAQ:SODA), after the company reported first-quarter results, posting adjusted revenue and EPS of $91.3 million and $0.15 versus Van Winkle’s $105 million and $0.06 estimates and consensus of $101 million and $0.03. With Sodastream shares last trading at $20.27, Van Winkle’s price target represents a slight upside potential from current levels.

Winkle noted, “Our F2015 revenue and EPS forecasts are reduced to $412 million and $0.77 from $478 million and $0.85. Our sales reduction is primarily volume driven as we’ve cut our soda maker, CO2 and flavor unit assumptions by 16%, 3% and 22%, respectively, on modestly lower ASPs to reflect incremental currency pressure. Our cuts to unit growth are most significant in the US.”

The analyst added, “The shares trade at 23x our F2015 EPS estimate and 10.6x corresponding EBITDA. While the PE looks steep for a business in decline, at less than 1x revenue we believe that the valuation appropriately discounts the current earnings and reflects a franchise value that isn’t reflected in the current earnings trend. We maintain our HOLD rating and our $19 price target, which is predicated on the shares trading at 9x a recovered preliminary EBITDA level in the $45 million range in F2016.”

According to, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Scott Van Winkle has a total average return of 13.2% and a 57.9% success rate. Van Winkle is ranked #198 out of 3594 analysts.

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