Diet sodas losing their fizz?

JP Morgan senior analyst John Faucher thinks diet sodas are losing popularity with American consumers. And the numbers in the latest report by Beverage-Digest are backing that up.

"Consumers are moving from categories that were perceived as better for you to stuff that is actually good for you," he told CNBC's "Power Lunch" on Friday. "They are noting that distinction and sparking water fits in there."

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A shift toward healthy eating has affected the sugary drinks categories across the board. Soda consumption slid 1 percent in 2014 while bottled water sales were up 7.3 percent over the same period. And Diet Coke lost its position to Pepsi as the second-most popular soda in the U.S.

Faucher said that these companies can cut their losses by offering alternatives to diet soda that consumers are actually craving both for their taste and health properties, such as seltzer.

"Trying to find something that is natural and tastes good, that's been the real problem so far," he said.

Woman squeezing lemon into sparkling water
Datacraft Co. Ltd. | Getty Images

A from Coca-Cola on their diet brand's sales drop read: "Diet Coke performance has been improving slightly, but we still have more work to do. We're committed to doing that and committed to getting the brand back on the road to sales growth again."

The company also noted that three of the four sparkling brands that grew last year were all Coca-Cola brands including Coke, Sprite and Fanta.

Disclosure: John Faucher does not own shares of Pepsi or Coke. But both companies are investment baking clients of JP Morgan.

—CNBC's Alex Rosenberg contributed to this story.