Reed's (REED) AI Stock Analysis

• Market Cap: $50.13M
• Dividend Yield: N/A
• Average Volume (3M): 6.84K
• Price to Earnings (P/E): ―
• Beta (1Y): -0.49
• Revenue Growth: -19.95%
• EPS Growth: 64.37%
• Country: US
• Employees: 24
• Sector: Consumer Defensive
• Sector Strength: 61
• Industry: Beverages - Non-Alcoholic
• EPS (TTM): -0.13
• Shares Outstanding: 48,673,720
• 10 Day Avg. Volume: 6,757
• 30 Day Avg. Volume: 6,839
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.08
• Enterprise Value/Revenue: 1.43
• Enterprise Value/Gross Profit: 4.78
• Enterprise Value/Ebitda: -7.37
• 1Y Price Target: $1.00
• Price Target Upside: -4.76% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 42 Neutral
• Price Target: $1.00 ▼(-4.76% Downside)

Reed's overall stock score is primarily impacted by its poor financial performance, with significant declines in revenue and profitability. While technical analysis and corporate events provide some neutral to slightly positive aspects, the negative valuation and mixed earnings call sentiment further weigh down the score.

Reed's Business Overview & Revenue Model

Company Description

Reed's Inc. is a leading beverage company specializing in the production of high-quality, natural ginger-based drinks. Founded in 1987, the company operates primarily in the non-alcoholic beverage sector, offering a diverse range of products including ginger ales, sodas, and kombucha. Reed's is known for its commitment to using real ginger and natural ingredients, catering to health-conscious consumers and those seeking authentic flavors. The company markets its products under the Reed's brand as well as other labels, expanding its reach in both retail and online channels.

How the Company Makes Money

Reed's generates revenue primarily through the sale of its beverage products, which are distributed across various retail outlets, including supermarkets, health food stores, and online platforms. The company leverages both direct-to-consumer sales and partnerships with distributors to reach a wider market. Key revenue streams include sales from their flagship ginger ales and other flavored sodas, as well as kombucha products that appeal to the growing trend of fermented beverages. Reed's also benefits from strategic partnerships with retailers and online marketplaces, enhancing its visibility and availability to consumers. Additionally, the company may engage in promotional campaigns and collaborations that drive brand awareness and consumer interest, further contributing to its earnings.

Reed's Financial Statement Overview

Summary

Reed's faces financial challenges with declining revenues and persistent losses, despite improvements in gross margin and liquidity. The balance sheet shows improved equity but high leverage risks. Cash flow remains a concern, requiring strategic financial management to ensure sustainability.

Income Statement

Reed's shows a declining revenue trend with a 15.1% decrease from $44.71 million in 2023 to $37.95 million in the TTM (Trailing-Twelve-Months). Gross profit margin improved from 21.7% to 30% in the same period, but net profit margins remain negative due to persistent net losses, highlighting ongoing profitability challenges.

Balance Sheet

The company has improved its equity position from negative to positive, with stockholders' equity reaching $6.65 million in the TTM. However, the debt-to-equity ratio remains concerning, and the equity ratio is relatively low, indicating potential financial instability.

Cash Flow

Operating cash flow improved but remains negative, reflecting ongoing operational challenges. Free cash flow remains negative, although Reed's has reduced its net debt significantly, improving liquidity but still indicating cash flow management issues.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	37.95M	44.71M	53.04M	49.60M	41.62M
Gross Profit	11.38M	9.71M	12.11M	13.60M	12.77M
EBITDA	-7.38M	-9.28M	-14.73M	-14.96M	-8.67M
Net Income	-13.15M	-15.52M	-19.11M	-17.60M	-11.48M
Balance Sheet
Total Assets	25.14M	18.88M	25.49M	26.32M	20.06M
Cash, Cash Equivalents and Short-Term Investments	10.39M	603.00K	533.00K	49.00K	595.00K
Total Debt	10.41M	27.58M	21.89M	10.78M	1.46M
Total Liabilities	18.49M	38.06M	33.96M	22.12M	9.65M
Stockholders Equity	6.65M	-19.18M	-8.47M	4.20M	10.40M
Cash Flow
Free Cash Flow	-6.28M	-4.35M	-15.44M	-17.92M	-9.66M
Operating Cash Flow	-6.12M	-4.27M	-15.43M	-17.59M	-9.50M
Investing Cash Flow	-167.00K	-20.00K	-2.00K	-335.00K	-161.00K
Financing Cash Flow	16.08M	4.36M	15.92M	17.38M	9.34M

Reed's Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.05
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For REED, the sentiment is Positive. The current price of 1.05 is above the 20-day moving average (MA) of 1.03, above the 50-day MA of 1.02, and below the 200-day MA of 1.13, indicating a neutral trend. The MACD of <0.01 indicates Negative momentum. The RSI at 50.84 is Neutral, neither overbought nor oversold. The STOCH value of 49.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for REED.

Reed's Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
COCO	78 Outperform	$1.93B	33.27	24.35%	―	11.97%	16.10%
AKO.A	72 Outperform	$3.41B	12.20	24.18%	7.43%	17.01%	11.63%
FIZZ	67 Neutral	$4.16B	22.25	37.23%	―	0.81%	5.51%
Sector *	63 Neutral	$20.95B	14.50	-3.82%	3.12%	2.72%	-11.24%
ZVIA	54 Neutral	$215.85M	―	-22.11%	―	-1.08%	54.50%
OTLY	52 Neutral	$514.68M	―	-114.20%	―	4.47%	42.22%
REED	42 Neutral	$50.13M	―	71.20%	―	-19.95%	64.37%

Reed's Corporate Events

Reed’s Reports Q2 2025 Financial Decline

Reed’s, Inc. reported a decline in financial performance for the second quarter of 2025 compared to the same period in 2024, with net sales dropping from $11.9 million to $9.5 million and a net loss increasing to $6.0 million. Despite these challenges, the company is focusing on strengthening its commercial execution and positioning for long-term growth by investing in sales talent, marketing, and channel development. Reed’s is also optimizing its product portfolio, which led to $1.6 million in inventory write-offs, to improve inventory management and focus on high-demand products. The company aims to expand distribution and enhance retail availability to drive future growth and profitability.

Reed’s Appoints CFO as Principal Accounting Officer

Reed’s, Inc. announced the reassignment of its Chief Accounting Officer, Joann Tinnelly, with her duties being redistributed among other personnel, while Doug McCurdy, the Chief Financial Officer, will take on the role of principal accounting officer starting July 7, 2025. Additionally, on July 1, 2025, Reed’s, Inc. settled a previous engagement with an investment bank by agreeing to pay a total of $1.6 million, ensuring a mutual release and waiver from any liabilities or obligations under the prior agreement.

Reed’s Boosts Capital with New Stock Sale

On June 4, 2025, Reed’s, Inc. issued and sold 3,225,806 shares of common stock for approximately $3,000,000, with D&D Source of Life Holding, Ltd. as the lead investor. The transaction aims to bolster Reed’s working capital and support corporate growth initiatives, including international expansion and strategic investments.