Cola Wars 2.0

Dear Rundown Reader,

Call it a blessing.

A lull in the trade row means we can get back to business.

We want to focus on the markets. And how you can use them to grow your bottom line.

But Trump, Putin, Xi and Erdogan have thrown geopolitical tensions in the pressure cooking and the action’s impossible to ignore.

Except for today. We’re back to business talking markets and one mega-merger that could start a new war.

A cola war.

Today’s Rundown unpacks Pepsi’s billion dollar buyout of SodaStream, and shows you how to play it.

Your Rundown for Monday, August 20, 2018…

Pepsi Secures Its Future With Multi-Billion Dollar Buyout

Thought the cola wars were over?

They’re not.

And soda maker PepsiCo (NASDAQ: PEP) is making a move that could crown it king.

The Wall Street Journal reports, “PepsiCo Inc. has agreed to buy home-carbonation company SodaStream International Ltd. for $3.2 billion.”

SodaStream (NASDAQ: SODA) burst on the scene offering folks a chance to make their favorite carbonated beverages right at home. SodaStream, as The Journal report notes, became an even bigger hit with consumers as preferences shifted to healthier carbonated beverages like seltzer.

The move makes perfect sense for Pepsi. As consumer tastes change this is a perfect pivot for the sugary beverage maker.

Plus, folks will still want soda. And if folks can make Pepsi at home they might give up Coke.

Ahead of finalizing the deal Pepsi shares are rising, up 2.48% over the last five days.

SodaStream shareholders are the biggest winners however. Over the past 30-days the stock is up almost 52%. Here’s the chart.

Most of SodaStream’s flash gains have passed. But this move is a big growth catalyst for Pepsi too.

We expect the real pop to come further down the road.

When Pepsi starts raking in SodaStream revenue, offsetting the $3.2 billion hit to their bottom line, their stock could hit new all-time highs.

Now, turning to the markets this morning…

Market Rundown for Mon., August 20

S&P 500 futures are up 3.25 at 2,855. A bit of trade war optimism? Rumor is new talks are scheduled. What are your thoughts on the trade war timeline?

Oil’s flat at $65.92. No sign of pressure from Saudi production cuts yet.

Gold’s up $9.20 to $1,193. Gold broke key support at $1,200, notes income expert Mike Burnick. Keep an eye out for his 11:00 a.m. Wealth Watch today to see what this means for you.

Bitcoin goes for $6,464 this morning, according to CoinDesk. The state of crypto hasn’t changed all year. It’s bad.

We’ll talk again on Tuesday.

For the Rundown,

Aaron Gentzler

Aaron Gentzler

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Aaron Gentzler

Aaron Gentzler is the publisher of Seven Figure Publishing. He is also the editor of The Rundown and has been with Agora Financial / Seven Figure Publishing since 2005. He's been covering technology and markets for over a decade.

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