Everybody is entitled to play it their own respective way, but usually you can't determine when the climb will come or where the fall will end. That's why I'm more of a buy on dips type of participant in the stock.
I'm sure we both knew that we would honor, but you probably know the acceptance of allocation would be the hardest part for both of us. We'll manage something for the best of both worlds. Still got an entire 3 months to go so anything can happen as we are all finding out today with Kmart.
Is K-Mart really a volume driver? In Q4 it will be as all retailers are for SODA. SodaStream always performs as one of the top holiday gifts. Throughout the year it will probably perform in-line with a SPLS or ODP imo.
No, you're not looking at it the right way in my opinion. Remember, this year you still have another 3500 additional doors so highlighting one partner, but excluding the others is an improper equation. The only thing important is that there were no bookings for QVC or HSN in Q4 last year and I know that at least QVC is scheduled for a Q4 Day Special. I would be surprised if we don't see an HSN as well. You won't see this consideration via Stifel or most analysts which is why their metrics are generally way off. Investors have to follow the cadence of retailers YOY to get the full picture... and be able to put the YOY into proper perspective.
The stock does not generate cash, nothing of significance. They will begin to do so next year however, but a buyback is not at all likely imo.
Been here done this. I am going to enjoy the opportunity to get overweight through Q4. Same thing happened in Q4 of 2011, the story doesn't change. It's why i try to enforce the inability of a short squeeze in SODA. For a very unique float, stock and product category you have to have a very unique understanding which is also why the multiple doesn't garner that of other companies with similar growth.
I don't know that I warned, but I did offer all the necessary points of analysis in my preview to consider. But yes, the key is the sell-out which was considerably strong. Unfortunately, as it pertains to this quarter, your biggest sell-in partner (WMT), could not manage inventory properly and it adversely affected SODA's sell-in numbers. WMT has and will continue to build inventory for SODA products though in Q4 so the numbers should balance back over time. The same thing happened in Q4 2011 where the Czech distributor didn't order and machine sale only rose 8%. Everyone cried the sky was falling and then of course in subsequent quarters the numbers once again balanced out with machine sales normalizing above 20%.
Did one for October at HSN last year which ran all day and netted 30,000+ starter kits. Management has already signed a deal to do one with QVC for Q4. I can't see HSN not doing one in Q4, wouldn't be smart on their part imo.
What you need to consider is Barclay's and CITI possibly reducing PT, as they are significantly out of the money and for an extended period of time. I don't know if they will or not, because the numbers are still increasing nicely and pushing some orders into Q4 may keep them at bay for another quarter, but still needs to be considered. Don't be surprised also if you see both an HSN and QVC spotlight in Q4, never had both before in a Q4, could also be impactful
This is very much a WMT related issue. You can literally draw the line from the sell-out data at WMT to the sell-in and see that the syrup growth was directly attributable to WMT destocking. Syrups are important and what you will likely see based on the conference call, is that WMT ordered in Q4 to get back into a better inventory position. Subsequently, the orders in Q4 for syrups will be adversely affected. WMT will be testing with expanding SODA shelf space as well. Already to launch "Happy Hour" skus (Night Spirits). Mark my words, they will also be doing the 130L spare and exchange in the coming quarters as well. Sell-out for syrups is over 45%, that should be the key number identifying the demand is definitively there, it's just WMT had vendor wide inventory issues. This is not specifically about SODA as Daniel noted.
At the same time and as noted in the beginning of the fiscal year, pipeline builds are important so far as jumping off a higher base, so the numbers need to begin to normalize. Good luck all!
WMT, across the board, not SODA specific either. They simply couldn't handle inventory levels in stores or DCs. Note that Daniel met with WMT two weeks ago, that draw down in Q3 will result in an increase in Q4 for the retailer. As reported they will be expanding shelf space to allow for more skus.
If the analyst on the call don't ask the right questions, he doesn't have what to answer. Not his fault. So yes, yes I am.