This "Coca-Cola Killer" is a Great Holiday Growth Stock to Own

A little anecdotal evidence goes a long way.

It's one thing to see the numbers on the page. It's another thing to be out in the marketplace and actually see what a company is doing.

This kind of boots-on-the-ground reconnaissance is one of the best ways to find what I call The Next Big Thing.

In the past few months, I've been all over the country -- in more airports than I can count. And, as I always do, I've made it a point to take a look around. And what I see, increasingly, is store displays for the SodaStream, manufactured by SodaStream (Nasdaq: SODA).

This $730 million Israeli company -- which has outpaced the S&P 500 during the past six months -- makes specialized machines and supplies that let people make custom soft drinks at home.

I first told my Game-Changing Stocks readers about SodaStream a little over a year ago. At the time, the product was only available on a limited basis and was not being advertised. Today, it's in practically every major retailer (including Wal-Mart, Target and BestBuy) and you might even see a commercial or two on TV for the product. 

Back in March I explained how, if you're looking for a solid growth stock, you should forget about Coca-Cola (NYSE: KO) and think about buying SodaStream instead -- especially after a recent drop in the share price. I was a little early in my call (the stock dropped a little further before rebounding back above where I recommended them), yet I still think this stock has legs.  

Unsurprisingly, these machines are flying off the shelves -- especially ahead of the holiday season. As a diabetic, I like that the device has a variety of sugar-free options. For families that drink a lot of soda, the stuff is actually cost-effective when compared with name brands like Coca-Cola and Pepsi (NYSE: PEP) after the cost of the machine has been recouped. These savings can be significant -- or at least perceived as appreciable -- which might push a consumer into the roughly $100 purchase.

I predict that SodaStream will be a big hit this holiday season, based on the retail footprint that I've noted in a wide range of stores. The shares are up about 5% since I last recommended them, and they look very appealing today. The company is likely to see a majority of its sales in the holiday fourth quarter, and if these results exceed expectations, there is a good chance that it will emerge as a big winner in the first quarter 2013.

SodaStream's topline grew nicely from 2010 to 2011, and its bottom line nearly doubled, as it pushed more product through the fixed cost of maintaining an international sales channel. So far this year, results have been strong. And the company has no debt.