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Opinions on SODA?


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2013 Jan 18, 10:03am   67,889 views  164 comments

by Patrick   ➕follow (55)   💰tip   ignore  

My wife bought me a Sodastream water carbonator and I like it because I can make fizzy water for about 30 cents a liter instead of paying $1 a liter in the store. OTOH I was kind of annoyed at their proprietary bottles and connectors which really do nothing more than hold and dispense carbon dioxide, but cost $15 to refill.

I'm getting kind of a good deal, but they're getting a really good deal because I know it can't cost more than $1 for them to refill that thing.

So... instead of being annoyed, I looked up the stock (SODA) and they have no debt, a P/E of 25, and seem to be growing rapidly. I bought some of the stock today. Mistake? What am I missing?

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1   zzyzzx   2013 Jan 18, 10:13am  

If you search the internet, you will find ways to refill the bottle yourself, or to connect a larger CO2 bottle to it. If you use this thing to make soda (instead of just fizzy water) it really isn't cheaper than store brand soda because the syrup is so expensive also. they are using the same business model as inkjet printers and razor blades.

In so far as to what you are missing, a lack of dividends and a P/E of 25 (which IMO is kind of high).

Someone will eventually come along and make a model that doesn't use proprietary connectors. Actually, that has already happened once, but they used cheap plastic threads on stuff so theirs broke often. They used standard paintgun C02 cartridges. I forget the name right now, but hopefully somebody else will make such a thing, because what they charge for the CO2 is too much of a ripoff for me to stomach. It's a convenience item to me.

2   zzyzzx   2013 Jan 18, 10:17am  

Paintball adapter:
http://www.criticalpaintball.com/SodaMod-p/sodastream-sodamod.htm

The SodaMod replaces the booby trapped SodaStream CO2 tank with a standard Paintball CO2 tank. It includes the SodaMod a USA made brass adapter that it fits into the SodaStream unit. Simply fill the Paintball CO2 tank with CO2 at any paintball store or gas supply house for $3.00-$5.00 (average price) instead of the $20.00-$30.00 that the SodaStream tank costs. Then screw the SodaMod adapter onto the tank and insert it in the SodaStream unit just like you would with the standard SodaStream tank. There are no unsightly and bulky hoses to deal with. The Sodastream unit with the SodaMod will look and perform the same as the stock SodaStream unit while saving you money.

3   zzyzzx   2013 Jan 18, 10:18am  


but cost $15 to refill.

Depends upon the Sodastream CO2 tanks side. They make a larger size bottle thats twice as big. It also costs twice as much to refill.

4   Patrick   2013 Jan 18, 10:21am  

I'm a little worried that the paintball CO2 tanks are not really food items. Could they have some contaminant in them?

What about getting a giant food-grade CO2 tank like McDonalds uses, and some adapter for that?

6   zzyzzx   2013 Jan 18, 10:27am  


What about getting a giant food-grade CO2 tank like McDonalds uses, and some adapter for that?

That's easy enough to do as well. Plenty of people do it. They also make 1/4 size ones that are more appropriate for home use.

Something like this is probably good for home use:
http://www.beveragefactory.com/draftbeer/tanks/co2/C5.shtml

Or one made of Stainless steel. You don't need one as big as one in a resturaunt!

7   Patrick   2013 Jan 18, 10:30am  

Maybe I'll get one of those, but I bet most people will not. They'll just go with the Sodastream bottles and be happy they're paying less than they'd pay in the store for fizzy water (if they drink that).

So are the earnings of SODA going to go up in the next couple of years? That's really my question here.

8   zzyzzx   2013 Jan 18, 10:35am  


So are the earnings of SODA going to go up in the next couple of years? That's really my question here.

I don't know since I don't consider the stock to be what I consider to be cheap at the moment. That and I don't like to own stocks that don't pay dividends. But that's just me. I don't doubt that there are plenty of people who would pay too much for a proprietary CO2 bottle enough to make it a good investment, but are you too late to jump on the bandwagon? I have to wonder about that.

I hope someone else chimes in here.

9   mell   2013 Jan 18, 10:41am  

Looks like they have a good business model, but a P/E of 25 is very high. HIgh starts at 15 in my book, so better look for stocks around P/E of 10-12. However in this market that may be hard.

10   zzyzzx   2013 Jan 18, 10:44am  

Part of my thinking is that if they have people hooked on proprietary CO2 bottles, insuring a steady income stream, why no dividend?

11   HEY YOU   2013 Jan 18, 10:56am  

CO2 causes Global Warming. If you drink it will you have a fever.

12   Patrick   2013 Jan 18, 11:10am  

mell says

Looks like they have a good business model, but a P/E of 25 is very high. HIgh starts at 15 in my book, so better look for stocks around P/E of 10-12. However in this market that may be hard.

I follow Peter Lynch's advice: if the P/E is lower then the growth rate percentage, it's OK to buy.

13   mell   2013 Jan 18, 11:16am  


mell says

Looks like they have a good business model, but a P/E of 25 is very high. HIgh starts at 15 in my book, so better look for stocks around P/E of 10-12. However in this market that may be hard.

I follow Peter Lynch's advice: if the P/E is lower then the growth rate percentage, it's OK to buy.

Ah ok, got it - then forge ahead ;)

14   mmmarvel   2013 Jan 18, 2:08pm  

I quit drinking SODA about 4 years ago. Decided that fizzy water probably wasn't doing my body a lot of good and the sugar or fake sugar that they put in also probably wasn't that good for me. I drink Sun Tea with no sweetener

15   swebb   2013 Jan 18, 4:33pm  


My wife bought me a Sodastream water carbonator and I like it because I can make fizzy water for about 30 cents a liter

I had one of those. I liked it for a different reason, though.

You can carbonate milk, coffee, wine. You can even try to carbonate apple sauce a maple syrup if you get frisky.

Come on, admit it...you've tried to carbonate anything that you can reasonably call a liquid. Shampoo? Have you tried that one yet?

16   marcus   2013 Jan 19, 1:01am  

How does in taste if you cut the amount of syrup ?

I don't care for artificial sweetners, but I also don't drink much soda because of the amount of sugar.

So I wondered about those machines, but using less syrup, and how it would taste.

Also, as this advances (if it does) there should be competition for the makers of syrups, and for ones that only use cane sugar and not high fructose corn syrup should occur.

IT seems to me that the syrup part is a big factor in the drink you end up with.

I sometimes buy soda water or sparkling water and mix it with juice, such as cranberry, but this is not an inexpensive option.

17   marcus   2013 Jan 19, 1:08am  

Speaking of Soda, this is a really interesting store that's not too far from me in Los Angeles. he offers something like 500 different types of soda. In the video he talks about corn syrup versus cane sugar.

Seriously, watch this video

http://www.youtube.com/embed/gPbh6Ru7VVM

18   New Renter   2013 Jan 19, 7:09am  

robertoaribas says

but on the other hand, on hot AZ summers, soda drinks are pretty refreshing, like scotch and soda, or gin and tonic...

Carbonated water with a little citrus is just the thing!

19   New Renter   2013 Jan 19, 7:17am  

Patrick,

You could get a setup like this:

http://www.youtube.com/embed/3lZM3O6r4bc&feature=player_embedded

20   marcus   2013 Jan 19, 7:40am  

New Renter says

Carbonated water with a little citrus is just the thing!

Hey, I'm going to try that. "REal lemon" or other concentrated lemon" add sugar and keep in fridge, to add to bottled soda, or sparkling water.

Or if you have the machine, add to super cheap sparkling water.

21   New Renter   2013 Jan 19, 7:48am  

I have to agree with some of the previous posters here - the investment in do it yourself carbonation hardware may negate the savings - if any - over just buying soda.

Unless you drink a LOT of soda!

If you do, go whole hog! Get a kegerator and a few corny kegs. Great for draft beer, cider, soda, whatever.

22   swebb   2013 Jan 19, 11:41am  

robertoaribas says

I bought one, it broke, so i took it back to costco. Personally I'm trying to drink less carbonated beverages, not sure even carbonated water is that good for you...

I heave heard that carbonated beverages aren't good for you...something about phosphorus.

Here, I found this:

http://www.livestrong.com/article/514804-is-soda-water-bad-for-you/

Sounds like the phosphoric acid in colas can be bad for your kidneys, but just carbonated water alone doesn't have it. Other concerns seem to be minimal or unfounded...drink up your carbonated water, I guess.

23   New Renter   2013 Jan 19, 2:04pm  

swebb says

robertoaribas says

I bought one, it broke, so i took it back to costco. Personally I'm trying to drink less carbonated beverages, not sure even carbonated water is that good for you...

I heave heard that carbonated beverages aren't good for you...something about phosphorus.

Here, I found this:

http://www.livestrong.com/article/514804-is-soda-water-bad-for-you/

Sounds like the phosphoric acid in colas can be bad for your kidneys, but just carbonated water alone doesn't have it. Other concerns seem to be minimal or unfounded...drink up your carbonated water, I guess.

Give it time - another study will be published that refutes the claims of the first...

24   New Renter   2013 Jan 19, 2:04pm  

robertoaribas says

to hell with soda, kegerator all the way, and good quality beer!

WORD!

Maybe you could put a kegerator in each of your rentals...

25   New Renter   2013 Jan 19, 2:14pm  

New Renter says

robertoaribas says

to hell with soda, kegerator all the way, and good quality beer!

WORD!

Maybe you could put a kegerator in each of your rentals...

Come to think of it in your climate you might go with a keezer. Its a chest freezer with a modified thermostat. Much better in hot climates.

Here's a pic of my favorite. If I had the room (and the skill) I'd be drinking from it now...

26   AverageBear   2013 Jan 20, 12:15am  

I was intrigued w/ SODA as an investment in the beginning of last year, and passed. I read a couple of articles online about how the sales of the CO2 are not keeping up w/ the 'base' sales of the actual carbonator. To me, this is how I would measure growth, or acceptance of the product.

After one is bought, or given as a gift, is the new customer enthusiastic and happy about the product since? To me, CO2 sales is my barometer for future growth, and IIRC, these sales #'s were 'meh', so-so. If this were an explosive growth story, C02 sales would be much, much healthier.....Being the Dividend Growth Investor (DGI) whore that I am, I just assume buy KO on the dips, and call it a day.

Speaking of health, my current favorite concoction is 8oz of Wyman's 100% blueberry juice w/ about 4oz of Polar seltzer water. (or change up the ratio to your liking).... Sweet and healthy...Hey, Wyman's 'stole' my recipe ;)

http://www.wymans.com/recipes/fizz.php

27   New Renter   2013 Jan 20, 12:36am  

robertoaribas says

though tonight it has been red wine, followed by a good bottle of jamaican rum I brought back with me...

Sounds like a great way to spend the evening!

It's possible to dispense non-sparkling beverage from a beverage dispenser. Simply use a separate argon or nitrogen tank instead of CO2. Some people set these up to deliver a beautiful stout by using "beer gas (25% CO2/75% Nitrogen) through a special tap.

I'm telling you - no man cave is complete without one!

Of course there is a cheaper, even more convenient option for wine:

http://en.wikipedia.org/wiki/Box_wine

But where's the fun in that?

28   unstoppable   2013 Jan 20, 12:38am  

Their main competitor iSi made a product called the twist and sparkle, it is now being recalled due to exploding bottles. I would keep tabs on what iSi is up to, if they introduce a non exploding version of the twist and sparkle, it will cut into the sales of the soda stream.

29   New Renter   2013 Jan 20, 12:43am  

AverageBear says

I was intrigued w/ SODA as an investment in the beginning of last year, and passed. I read a couple of articles online about how the sales of the CO2 are not keeping up w/ the 'base' sales of the actual carbonator. To me, this is how I would measure growth, or acceptance of the product.

I'd agree with that. There is a convenience factor to just buying soda drinks, especially if one's consumption pattern is irregular.

31   Tenpoundbass   2013 Feb 18, 3:52am  

zzyzzx says

new Samsung refrigerator dispenses sparkling water

How cool is that, can the iPhone make seltzer?

32   varmint   2013 Feb 18, 6:03am  

New Renter says

Here's a pic of my favorite. If I had the room (and the skill) I'd be drinking from it now...

that's the fanciest jockeybox I've ever seen

33   zzyzzx   2013 Feb 18, 10:13am  

New Renter says

You could get a setup like this:

This one is likeable just for the Homer Simpson T shirt alone.

34   Patrick   2013 Feb 19, 8:50am  

zzyzzx says

http://news.consumerreports.org/appliances/2013/02/the-samsung-rf31fmesbsr-is-the-first-to-dispense-sparkling-water.html

new Samsung refrigerator dispenses sparkling water

This is good news for SODA actually, since the Samsung fridge will use a SodaStream-made dispenser!

35   Tenpoundbass   2013 Feb 19, 10:17am  

Phew what an ordeal, but it turns out I'm right, it's called Seltzer.

OK You Google "Seltzer Water" and you get one "Soda Water" wiki entries and 15,000,000 Alka Seltzer entries(I kid you not).
The Wiki Article makes no mention of Seltzer Water other than to list it as a disambiguation.

So now I'm really curious, how in the hell did Soda Water, come to become called Seltzer water, or visa versa.

I Googled Seltzer and got this limited Definition.

http://www.merriam-webster.com/dictionary/seltzer

and found this interesting entry under Seltzer origins.

modification of German Selterser (Wasser) water of Selters, from Nieder Selters, Germany
First Known Use: 1775

So I Googled Nieder Selters, and found
Niederselters in Selters was a well in Germany where the oldest known mineral water comes from.

But the Wiki entry for "Selters" and "Carbon Water" countradict each other.

http://en.wikipedia.org/wiki/Selters
Alexandra Selivanova was credited as a source though, it is a blog in German.

Artificial "selters waters" with added minerals have been created to make competition, thus helping to establish the fame of the original water as an international reference of soda water, e.g. by Torbern Bergman who made thorough analyses of mineral waters and in 1775 presented how to to make carbonated water to mimic genuine mineral waters

How ever the Wiki entry for Soda Water/Carbonated water/soda water states...

http://en.wikipedia.org/wiki/Carbonated_water
Citation needed...

In 1771, chemistry professor Torbern Bergman independently invented a similar process to make carbonated water. In poor health and frugal, he was trying to reproduce naturally-effervescent spring waters thought at the time to be beneficial to health

So which came first the Chicken or the egg?

So the best I can tell, Seltzer Water was a knock off Selter water.
Probably due to tough intellectual property laws in the late 1700s
they couldn't call it Selters water, because it wasn't natural and didn't come from Selters.
Because no where on the internet can I find anywhere, that will precisely claim when and how Seltzer became to be called Seltzer water.
The only time in either article that Seltzer is even mentioned.

The name and the water of Selters are the prototype of seltzer, a soda water variety well-known in the USA.

Not sure how far to the top this cover up conspiracy to deny Seltzer it's rightful place in history goes, but I'll get to the bottom of it.
And Sodastream will have to change their name to Helter Seltzer.

36   New Renter   2013 Feb 19, 10:29am  

I think the Captain has found his white whale...

37   zzyzzx   2013 Feb 20, 10:57pm  


This is good news for SODA actually, since the Samsung fridge will use a SodaStream-made dispenser!

Probably, but I personally wouldn't want something like that built into a refrigerator. I mean, unless it also stores cold water to use for it, what's the point of having it (and i have no idea if it does, but if it doesn't, it should).

38   FortWayne   2013 Feb 21, 2:31am  

I'm thinking of doing that too, they seem like a solid company. A lot rides on their marketing message now, if they can get people to switch it'll be fantastic.

Personally I'm thinking of DIY version of it. It's not hard and will be fun when kids visit.

39   zzyzzx   2013 Feb 21, 2:37am  

Their stock is on sale today!! $47.44/share right now!

40   Tenpoundbass   2013 Feb 21, 3:03am  

The word must have gotten out about Torbern Bergman's patent violations, that infringed on Niederselters's intellectual property theft.

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