SodaStream Shares Plunged: What You Need to Know

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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of homestyle soda-machine maker SodaStream International (NAS: SODA) lost some of their fizz today, going flat to the tune of 11.6% on above-average volume.

So what: Investor-entertainer Jim Cramer savaged the stock on his popular Mad Money show last night, citing quality control issues and a dodgy second quarter. When Cramer speaks, small-caps jump -- or dive.

Now what: As much as we Fools like to poke fun at Cramer, his misgivings about the second quarter make a lot of sense. For example, when SodaStream doesn't strike a deal with megaretailer Costco (NAS: COST) because management doesn't like the product placement in Costco stores, it sounds like a weak excuse that raises questions about how sellable these soda systems really are. In Cramer's eyes, SodaStream machines are emphatically not the next hypergrowth consumer opportunity like the Green Mountain Coffee Roasters (NAS: GMCR) Keurig single-serve machines.

This fad has failed once before -- or am I the only one who was surrounded by SodaStreams for a brief moment in the early 1980s? As much as I respect my friends on the Rule Breakers research team, their endorsement of SodaStream leaves a sour taste in my mouth.

Interested in more info on SodaStream? Add it to your watchlist.

At the time this article was published Fool contributor Anders Bylund holds no position in any of the companies discussed here. The Motley Fool owns shares of Costco Wholesale. Motley Fool newsletter services have recommended buying shares of Costco Wholesale, SodaStream International, and Green Mountain Coffee Roasters. Motley Fool newsletter services have recommended creating a lurking gator position in Green Mountain Coffee Roasters. Yeah, we coined that term. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool is investors writing for investors.

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