Jefferies analyst Akshay Jagdale maintained a Hold rating on Sodastream (NASDAQ: SODA) today and set a price target of $100. The company’s shares opened today at $142.72, close to its 52-week high of $142.80.
Jagdale commented:
“PEP is buying SODA for $144/share. The deal values SODA at ~20x EBITDA, which is at the high end of comparable transactions in the consumer staples space. The rich valuation combined with our concerns about system attrition rates and relatively conservative HHP potential expectations leaves us scratching our heads as to the strategic merits of the deal for PEP. Deal valuation is relatively rich when compared to other comparable transactions in the space; as such, we don’t expect a competing bid. We estimate the deal values SODA at ~25x TTM EBITDA of $127M, which is at the high end of transactions in the staples sector (see Chart 1).”
According to TipRanks.com, Jagdale is a 4-star analyst with an average return of 4.7% and a 54.4% success rate. Jagdale covers the Consumer Goods sector, focusing on stocks such as Lamb Weston Holdings, McCormick & Company, and J & J Snack Foods.
The word on The Street in general, suggests a Moderate Buy analyst consensus rating for Sodastream with a $124.33 average price target.
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Based on Sodastream’s latest earnings release for the quarter ending June 30, the company reported a quarterly net profit of $26.11 million. In comparison, last year the company had a net profit of $14.37 million.
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SodaStream International Ltd. operates as a holding company, which engages in the development, manufacture, distribution, and marketing of home carbonation systems. Its products include drink maker machines, soda caps, carbonators, reusable carbonation bottles, and flavored syrups.
