National Beverage (FIZZ +8%) is trading at a new all-time high after reporting strong third quarter results this morning.
Third quarter earnings per share grew 117% to $0.52 with revenue up 20% to $194.5 million, blowing away the single Wall Street estimate.
The company doesn't disclose much and doesn't host a conference call.
Still, we can assume that pretty much ALL of the growth is coming from Lacroix. The carbonated (sparkling) water brand has become quite popular. LaCroix has a myriad of flavors (all with no sugar) and little marketing to speak of.
LaCroix continues to take market share as consumers choose less sugary drinks like soda and instead opt for a more healthy, or mindful alternative. We have also seen SodaStream (SODA) take advantage of this trend while sales of soda have languished. National beverage owns the Faygo and Shasta soda brands as well as some juice and energy drink brands. But again, it's all about LaCroix for investors.
Chairman and Chief Executive Officer Nick Caporella owns more than 70% of the company. He is 80 years old, leading some to believe the growth-starved consumer packed goods (CPG) giants may eventually acquire the company.
The company's lofty valuation seems to price in much of that potential takeover premium, however. The $3 billion market capitalization is relatively modest in the CPG sector but the stock trades at ~18x EV/EBITDA. The multiple comes down to ~16x looking at the single fiscal 2018 (April) estimate. Earlier this year, Reckitt Benckiser paid 17.4x fiscal 2016 EV/EBITDA for Mead Johnson.
Still, momentum investors may be salivating at the small float and ~20% short interest