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SodaStream’s stock leaps on report of PepsiCo pact

PepsiCo is reportedly planning a small 10-week test run with SodaStream, a pact that could help the at-home soda maker as it struggles with sharply lower machine sales in the U.S. market.

SodaStream’s (SODA) shares leapt by about 14% following the news of the report, which was initially reported by industry publication Beverage Digest.

Some of the investor enthusiasm might center on hopes that SodaStream could one day be acquired by PepsiCo (PEP). For a while now, it has been speculated that PepsiCo and Coca-Cola (KO) have considered bids for the soda maker. Some analysts have said a collaboration would make more sense than a full acquisition.

Along those lines, SodaStream is facing some steep competitive pressure of late. Keurig Green Mountain (GMCR) and Coke have joined forces to develop soft drinks and other cold beverages for a new at-home system, due to hit shelves this fall.

However, even before the Keurig could present a significant challenge, SodaStream has reported lackluster results of late. Earlier this month, the company warned investors that it hadn’t had much success attracting new customers to buy its beverage carbonation system, raising further questions about if that trend is fizzling out. The company warned third-quarter revenue would total about $125 million, a roughly 14% drop from a year ago. Machine sales in the U.S. tumbled significantly in the first two quarters of 2014, suggesting the trend of at-home soda making has hit a wall in that market.