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Ryan Canady
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I am a recent college graduate learning to navigate the markets while I'm young. At the moment, I do not have large sums of capital in the market. However, I am working to build my portfolio over time in a disciplined manner. I realize my young age may deter some from taking my research... More
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  • Is SodaStream Being Bullied At These Levels?

    Picture the concept of turning pure tap water into sparkling soda at home. This was the dream that Sodastream (NASDAQ:SODA) promised to provide to any consumer who purchased their at home soda making machine. They actually created this reality for their customers, but the fizzy goodness may have been short lived for Sodastream.

    While the stock seemed to be on an unstoppable march a long time, it topped out in the summer of 2013. At that peak, the stock traded just under $73 a share. Today, the stock sits at $20.12 a share (as of the close on 12/10/2014). It is time to consider if this one is really doomed to head to zero or if it is about to rebound.

    Peaks And Valleys Not Uncommon With SodaStream

    Let us first take a look at the charts. It should be noted that while SodaStream is in a tremendous downswing at the moment, it is not uncommon for this stock to see peaks and valleys. Even in just a short five year period this stock has seen two jagged peaks followed by lengthy valleys. Some might say that this makes this equity a volatile stock. However, if it seems to have more predictable patterns of over excitement and then pullbacks, it may be easier to play than some other stocks.

    Shorts Are Easing Off On SodaStream

    At one point in time, SodaStream was among the top names that short sellers were gravitating towards. They saw the company as receiving too high of a valuation for too few results. In fact, in April of 2012 an incredible 85% of the float for SodaStream was short the stock. Since then, the shorts have been easing off and covering. It seems as though most of the short sellers got their fill during the 18 month decline that this stock has been through. Only a brave 19% of the float is short anymore.

    While it appears that the shorts are letting up, this alone is not a good enough reason to snatch up the stock. Shorts can be wrong about the market just as easily as longs can. However, seeing short sellers ease off of a company is a profoundly important sign that perhaps the worst of the ride is over. At the very least it means that most shorts are not willing to touch this name at current prices.

    Rumors Of A Buyout Abound

    If rumors about SodaStream are to be believed, then $20.12 a share may seem discount bin cheap. Dailyfinance.com reported in late September that buyout possibilities were being discussed by other companies in the industry. They stated the following,

    Sources were telling several different international publications last week that the company behind the namesake carbonated beverage maker is in talks to be acquired for at least $40 a share.

    The article was quick to note that unfounded rumors of a buyout of SodaStream have surfaced before. However, if the rumors are to be believed this time around, then the current share price is certainly not pricing this possibility in.

    It seems reasonable to believe that soda makers like Coca-Cola (NYSE:KO) and PepsiCo (NYSE:PEP) would have at least some vested interest in taking over SodaStream. SodaStream currently tries to cut at the heels of those two companies with their products. If one or the other were to buy out SodaStream, they could claim those profits for themselves. According to Businessinsider.com, PepsiCo is already working with SodaSteam to test some of its flavors in SodaStream's machines. Currently, those tests are exclusively being conducted in Florida markets, but this could expand if things go well.

    Buy And Wait For A Pop, Do Not Stay For The Fizz

    Although the price of SodaStream looks incredibly cheap considering all of the already mentioned factors, it is perhaps best to purchase this one for a quick score. It does seem like this is the kind of stock that catches a lot of momentum for a time only to give it all back to the poor souls who buy it at the top.

    Though the stock may not be worthy of taking a place in your grandfather's "buy and hold" style portfolio, you might want to take advantage of this one for a short to intermediate term profit.

    Tags: SODA, long-ideas
    Dec 11 11:09 PM | Link | 1 Comment
  • Bizarre Story Shows Continuing Strength Of Apple's Appeal
    Looking around at just about any modern city in the world you might be forgiven for thinking that Apple (NASDAQ:AAPL) has taken over the world. With literally millions of Iphones, Ipads, and Ipods being sold every month, Apple's products are some of the most popular in the history of the world. Apple is in nearly every corner of the world as evidenced by its own website. Finally, the company became the largest in the world in terms of market cap back in August 2011. 

    All of this enormous sucess has not detered some detractors who say that the stock price has gotten beyond where it should be. Just today (1/17/2012) for example the company is banging around its all time high stock price closing at $424.70. This has some worried simply based on technical indicators or a worry that the company does not deserve this valuation without its leader Steve Jobs. Despite these concerns, there is no doubt in my mind that AAPL is going higher and will reward shareholders for a long time to come. 

    China Loves The Iphone (Maybe A Little Too Much)

    The bizarre story that came out this past Friday was that Apple had to temporarily suspend sales of its flagship Iphone product in mainland China. This decision came after chaos decended outside stores selling the Iphone 4s product as it was released in China. Waiting customers were throwing eggs at the store when they got frustrated that demand had exceeded supply and the stores were out of Iphones. In response to the incidents, Apple decided to suspend store sales of the phone for the time out of fear for the safety of the employees. Apple did continue to sell the phones online though. 

    This kind of chaos is a problem that most companies would gladly take off of Apple's hands. It is just another sign of the massive appeal of the products that Apple produces. It also highlights the fact that there is still plenty of demand to be met in China and elsewhere for this product. Apple would not even have to come out with new products and it could just ride the wave of the ones it has already released. That being said, there are likely many more things coming down the pipe. Some speculate that maps, tvs, or even cars could be next for Apple! Regardless, there are plenty of places that already have a market for Iphones and other Apple products, and many more that are still waiting for their chance at them. 

    For a company that boasts nearly $26 billion in cash, no debt, and one of the most loved and recognized products in the world, I say that it is still undervalued. Earnings are expected to be over $39 a share for next year, and the growth of the company is expected to continue at an 18% clip for at least the next 5 years. This is an incredible buying opportunity even if the shares fall in the short term. Investors should purchase on the dips and continue to add to their holdings over the months and years. This is a stock that will reward those who are loyal and hold for the long run. 


    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
    Tags: AAPL, Apple
    Jan 21 12:40 AM | Link | Comment!
  • Yahoo Names New CEO: Too Little, Too Late
    The struggling Yahoo (NASDAQ:YHOO) is trying to draw a rabbit out of a hat with its latest CEO selection. On January 4, 2012, Yahoo named Scott Thompson as its new CEO. Thompson is the current president of the popular Paypal service (a subsidiary of Ebay (NASDAQ:EBAY)). Thompson will officially start the job on January 9th.

    The company has been in disarray for some time, and this was highlighted in the firing of the previous CEO Carol Bartz by the company's board back in September. This sloppy firing was done via telephone after frustration reached a boiling point with Bartz. Bartz had two and a half years to work to turn the company around, and yet little to nothing was getting accomplished. Since that September firing, the CFO has been playing the role of CEO on an interim basis. Now that Thompson has been hired, there is at least a permanent CEO, but many feel that this is too little too late.

    Shareholders Wanted To Sell

    A large group of activist shareholders in the company wanted it to be sold. A sell off of the company to one of the other tech giants could be more of a benefit to shareholders than trying to turn the company around would be. As recently as October, rumors abounded that both Google (NASDAQ:GOOG) and Microsoft (OTCQB:MFST) were working to finance a deal to aid private equity groups in the purchase of Yahoo. Despite this, Yahoo has decided to move forward with a new CEO and try to fix its problems for itself. So far the stock is down 2% on the news.

    Too Little, Too Late

    Thompson is an outsider to the company, and there is no way to know what his level of success will be. That being said, we do know some things. We know that many of Yahoo's services are now being squeezed out of the market by better competitors. Yahoo search for example has never been able to keep up with Google. There are other issues going forward as well, and this is why many investors want the company sold. Naming a new CEO from a successful brand is not enough to save the company. Instead, the board should have considered doing what it could to get itself sold for the benefit of the shareholders. Their latest move to hire a new CEO may grab some headlines, but it is not doing what is right for the company.


    The stock price has been rather flat for the last 7+ years. This is simply not acceptable for shareholders that expect to earn some kind of return on their money over this period of time. The 5 year chart above tells it all. If things don't change in a hurry, look for more shareholder anger and a potentially lower share price for YHOO.


    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
    Tags: YHOO, Yahoo
    Jan 08 8:27 PM | Link | Comment!
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