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Reed's
(NYSE MKT:REED)
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Rating:40Underperform
Price Target:
$0.95
Action:Downgraded
Date:06/27/26
REED scores low primarily due to weak financial performance: shrinking revenue, sharply lower gross margins, very large losses, heavy cash burn, and elevated leverage with thin equity. Technicals also reflect sustained downside (below major moving averages with negative MACD). Management’s sequential-improvement guidance and operational corrective actions provide some support, but listing-risk and the magnitude of recent operating deterioration keep the overall score depressed.
Positive Factors
Wide retail distribution
A national footprint in 32,000+ stores provides durable market access and shelf presence that supports baseline sales while management executes recovery plans. Broad distribution decreases dependence on any single account and enables scalable promotional and e‑commerce rollouts over the coming quarters.
Negative Factors
Multi‑year revenue contraction
Persistent top‑line decline erodes scale needed to cover fixed costs and weakens bargaining leverage with retailers and distributors. Continued revenue contraction raises the bar for operational fixes to restore profitability and makes multi‑quarter recovery necessary to stabilize cash flow and margins.
Read all positive and negative factors
Positive Factors
Negative Factors
Wide retail distribution
A national footprint in 32,000+ stores provides durable market access and shelf presence that supports baseline sales while management executes recovery plans. Broad distribution decreases dependence on any single account and enables scalable promotional and e‑commerce rollouts over the coming quarters.
Read all positive factors
Reed's Key Performance Indicators (KPIs)
Any
Cases Breakdown
Shows how case shipments are distributed across product lines, pack sizes, flavors and sales channels (retail, e‑commerce, foodservice). Reveals which SKUs and channels drive volume and margins, highlights shifts in consumer preference or promo dependence, and flags inventory or distribution issues that can pressure revenue and profitability.
Shows how case shipments are distributed across product lines, pack sizes, flavors and sales channels (retail, e‑commerce, foodservice). Reveals which SKUs and channels drive volume and margins, highlights shifts in consumer preference or promo dependence, and flags inventory or distribution issues that can pressure revenue and profitability.
Data provided by:
The Fly
The FlyReed's (REED) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$11.86M
Dividend YieldN/A
Average Volume (3M)61.64K
Price to Earnings (P/E)―
Beta (1Y)-0.03
Revenue Growth-18.78%
EPS Growth80.36%
CountryUS
Employees44
SectorConsumer Defensive
Sector Strength42
IndustryBeverages - Non-Alcoholic
Share Statistics
EPS (TTM)-1.60
Shares Outstanding11,857,086
10 Day Avg. Volume115,434
30 Day Avg. Volume61,642
Financial Highlights & Ratios
PEG Ratio-0.07
Price to Book (P/B)1.91
Price to Sales (P/S)0.51
P/FCF Ratio-1.01
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda>-0.01
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusHold
Number of Analyst Covering1
EPS Forecast (FY)-0.69
Revenue Forecast (FY)$37.31M
Reed's Business Overview & Revenue Model
Company Description
Reed's, Inc. (symbol: REED) operates as a manufacturer and distributor of premium, all-natural handcrafted beverages. These artisanal concoctions, part of the craft specialty foods sector, are available across a wide geographical footprint, spanni...
How the Company Makes Money
Reed's primarily makes money by selling branded beverages to wholesale customers (e.g., distributors and retailers) who then sell the products to end consumers. Revenue is generated from product sales across its beverage portfolio—most notably gin...
Reed's Earnings Call Summary
Earnings Call Date:May 12, 2026
(Q1-2026)
| Next Earnings Date:Aug 06, 2026
Earnings Call Sentiment Negative
The quarter showed substantial operational and financial deterioration: sizable revenue decline (~29%), severe gross margin compression (34%→10%), widened net loss and negative EBITDA, and a significant reduction in cash. Management has taken multiple corrective actions (inventory controls, cost reductions, expanded sales force, e‑commerce initiatives, Amazon restructuring, pricing actions, and a new COO) and reports early signs of improvement, but the negative financial trends and execution issues in Q1 are material and outweigh the early remediation progress.Positive Updates
Actions Taken to Stabilize Operations
Management implemented a broad corrective plan in early 2026 including enhanced inventory controls, headcount reductions, marketing SG&A cuts, postponement of a brand restage, and appointment of a new COO (Damian Warshall) to improve execution and profitability.
Negative Updates
Sharp Revenue Decline
Net sales for Q1 2026 were $7.1M versus $10.0M a year ago, a decline of $2.9M or approximately -29% year-over-year, driven by lower volumes with recurring national customers and higher promotional/other allowances.
Read all updates
Q1-2026 Updates
Positive
Negative
Actions Taken to Stabilize Operations
Management implemented a broad corrective plan in early 2026 including enhanced inventory controls, headcount reductions, marketing SG&A cuts, postponement of a brand restage, and appointment of a new COO (Damian Warshall) to improve execution and profitability.
Read all positive updates
Company Guidance
Management characterized Q1 as transitional and guided that corrective actions should drive sequential quarter‑to‑quarter improvement — specifically in net sales, gross margin and net loss — with early margin improvement already observed and management expecting to be “back on the right track” by the end of Q2. Q1 reported metrics: net sales $7.1M (vs $10.0M YoY), gross profit $0.7M (vs $3.4M), gross margin 10% (vs 34%), delivery & handling down 31% to $1.1M and 16% of sales or $2.57 per case (vs $3.17/ case), SG&A $5.8M (vs $3.5M), net loss $6.5M or $(0.55)/share (vs $2.0M or $(0.27)), EBITDA negative $6.2M (vs negative $1.7M), cash used in operations $5.8M (vs $5.4M), cash $4.6M at 3/31/26 (vs $10.4M at 12/31/25) and total debt $9.2M net of deferred fees. To support the guidance management has liquidated tens of thousands of cases of low‑margin inventory, exited an Amazon arrangement costing ~ $1.0M annually, implemented pricing/COGS and SG&A reductions, reinstated heritage glass and Zero Sugar cans, launched retail media/e‑commerce programs (Instacart, walmart.com, albertsons.com, kroger.com) and retained a >80‑person commission sales agency to accelerate SKU placements and promotions.Reed's Financial Statement Overview
Summary
Income Statement
18
Very Negative
Balance Sheet
22
Negative
Cash Flow
12
Very Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Mar 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 31.18M | 34.06M | 37.95M | 44.71M | 53.04M | 49.60M |
| Gross Profit | 4.26M | 6.96M | 11.38M | 9.71M | 12.11M | 13.60M |
| EBITDA | -19.05M | -14.57M | -7.38M | -9.28M | -14.61M | -14.96M |
| Net Income | -20.27M | -15.85M | -13.15M | -15.52M | -20.06M | -16.40M |
Balance Sheet | ||||||
| Total Assets | 18.69M | 23.34M | 25.14M | 18.88M | 25.49M | 26.32M |
| Cash, Cash Equivalents and Short-Term Investments | 4.58M | 10.42M | 10.39M | 603.00K | 533.00K | 49.00K |
| Total Debt | 10.04M | 10.03M | 10.41M | 27.58M | 21.89M | 10.78M |
| Total Liabilities | 15.99M | 14.19M | 18.49M | 38.06M | 33.96M | 22.12M |
| Stockholders Equity | 2.69M | 9.15M | 6.65M | -19.18M | -8.47M | 4.20M |
Cash Flow | ||||||
| Free Cash Flow | -17.72M | -17.32M | -6.28M | -4.35M | -15.44M | -17.92M |
| Operating Cash Flow | -17.52M | -17.04M | -6.12M | -4.27M | -15.43M | -17.59M |
| Investing Cash Flow | -179.00K | -253.00K | -167.00K | -20.00K | -2.00K | -335.00K |
| Financing Cash Flow | 17.42M | 17.32M | 16.08M | 4.36M | 15.92M | 17.38M |
Reed's Technical Analysis
―
Price Trends
Market Momentum
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For REED, the sentiment is undefined. The current price of undefined is equal to the 20-day moving average (MA) of ―, equal to the 50-day MA of ―, and equal to the 200-day MA of ―, indicating a neutral trend. The MACD of ― indicates undefined momentum. The RSI at ― is undefined, neither overbought nor oversold. The STOCH value of ― is undefined, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a undefined sentiment for REED.
Reed's Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% |
* Consumer Defensive Sector Average
Performance Comparison
Reed's Corporate Events
Business Operations and StrategyShareholder Meetings
Reed’s Stockholders Approve 2026 Equity Incentive Plan
Positive
Jun 11, 2026
On June 10, 2026, Reed’s, Inc. held its 2026 annual meeting of stockholders, where shareholders approved the Reed’s, Inc. 2026 Equity Incentive Plan that had been adopted by the board on March 31, 2026. The plan took effect immediately...
Delistings and Listing ChangesRegulatory Filings and Compliance
Reed’s Faces NYSE American Noncompliance and Delisting Risk
Negative
Jun 3, 2026
Reed’s, Inc., a U.S. craft beverage producer specializing in natural ginger-based and premium sodas under the Reed’s, Virgil’s and Flying Cauldron brands, distributes its products in over 32,000 stores nationwide. The company pos...
Business Operations and StrategyExecutive/Board Changes
Reed’s Appoints Damian Warshall as New Chief Operating Officer
Positive
Apr 24, 2026
Reed’s, Inc., a U.S. craft beverage maker known for its premium, better-for-you ginger and soft drinks under the Reed’s, Virgil’s and Flying Cauldron brands, sells its products in more than 32,000 retail locations nationwide. The...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.