SodaStream soared 9.7% as PepsiCo rose 0.1%.
Nooyi, who announced her retirement just two weeks ago, successfully transformed the company from a focus on their sugary and calorie laden flagship product to a diversified portfolio, with significant revenue from healthier options since taking over the beverage leader in 2006.
The acquisition of SodaStream seems very much in line with her vision for the company, analysts say.
"We see the acquisition as a play on health/wellness and sustainability trends (home carbonation including a reduced consumer plastic footprint), and growing household penetration potential over time," Morgan Stanley analyst Dara Mohsenian wrote in a note this morning assessing the deal.
He added that the penetration of SodaStream into developed markets in Europe is a strategic positive for the company, causing him to issue an overweight rating for the stock and a price target of $127.
Pepsi has consistently focused on the health and sustainability trends that Mohsenian touches on under Nooyi's leadership.
During its July 10 earnings presentation, the company reported that "good for you" and "better for you" products now account for 50% of the company's revenue, up from 38% in 2006. The portfolio that is growing its reliance on healthier options, can now count sparkling water among their diversifying assets.
Incoming CEO Ramon Laguarta has stated his intention to continue growth in these areas, particularly in water, which is aided by the SodaStream acquisition.
"SodaStream is highly complementary and incremental to our business, adding to our growing water portfolio, while catalyzing our ability to offer personalized in-home beverage solutions around the world," he said of the deal which slaps an 11% premium on the Israeli company's last closing price on Friday.
The move seems a shrewd one based upon market forecasts, as sparkling water is scheduled to grow from a $4 billion industry at present to an over $6 billion industry by 2021, per a Statista report, while the trend in sugary sodas has been on a largely consistent downward trend by contrast.
The success of brands like La Croix in establishing sparkling water the millennial market also indicate that the drive into sugar-free, carbonated water with SodaStream could benefit future growth after Laguarta takes the reins on October 3.
Further, the focus on sustainability appeals to the same market demographic as well.
According to a Glass Packaging Institute report, 75% of millennials "actively look for changes they can make in their home and lifestyle to be greener," indicating that ditching wasteful plastic packaging for sodas could be an important movement in the industry moving forward.
Earlier this month, SodaStream CEO Daniel Birnbaum touched on this when raising growth targets for the company during the company's second quarter earnings presentation.
"I strongly believe we are poised better than ever before to drive continued growth and increase shareholder value especially as SodaStream is a great alternative to single use plastic bottles which are now being revealed as a hazard not only to the environment but possibly also to human health," he commented.
Pepsi can now count on that appeal as a significant segment of its business.
However, despite Pepsi's history of changing its business to reflect trends in consumer behavior regarding healthier foods, analysts remain mindful of the company's lagging core business.
"We can't help but see parallels to [Coca Cola's] (KO) decision to acquire a stake in Green Mountain in 2014, and question whether this deal - which also brings together a large consumer packaged goods company and an in home beverage maker - will do much to solve PEP's ongoing struggle to improve volumes in its North American Beverage segment," Wells Fargo analyst Bonnie Herzog wrote in a note this morning.
In maintaining a market perform rating for the company, Herzog explained that while the SodaStream acquisition complements the company's water offerings and is in line with their drive to add healthier products, it does not erase existing issues in the company's largest segments.
"We remain concerned about challenges facing PEP's core business - and, as such, continue to see limited upside for PEP," she explained.
The deal will be finalized in early 2019.