SodaStream(SODA) reported earnings on February 20th that beat analyst estimates, while also raising it's revenue and earnings outlook. The stock sold off over the next few trading sessions, as the bears took control even with analysts becoming more bullish on the companies future prospects. We have been waiting and watching for another great entry point, and we think the $50 level is a great place to get long via some calls. If the bulls are able to break above $50 with strong volume, we think the stock will be in a new uptrend and will break the 52 week high of $53.99 in short order.
Adding fuel to the possible fire is the increase in bearish bets via shorting the stock. Those betting on downside have increased their short position 300,000 shares to 7.9 million or 45% of the available trading shares. This should provide more fuel for the move higher.
We currently hold March 52.50 calls, and may look to add to our position over the next few session.