Sell Shares of Jones Soda Co.

A high valuation is one reason Zacks senior consumer products analyst Steven Ralston, CFA currently rates shares of Jones Soda Company (JDSA) a Sell. For more details, we turned to his latest report on the company: "Management has been successfully implementing a growth strategy based on introducing innovative new products, employing unique marketing programs and utilizing multiple channels of distribution. The company is in the early stages of development as a participant in the carbonated soft drink (CSD) industry. But given the stock's high valuation, a recent negative earnings surprise and management's pared revenue guidance, the stock is downgraded to a Sell. "In the most recent quarter, management lowered revenue growth outlook to the range of 30% to 40% from the earlier estimate in the 50%-range, primarily due to the timing issues related to the late shelving of the CSD product and a slower than planned launch of the concentrate products. As a result, the company did not achieve the targeted 25% in ACV (all commodity volume) by Memorial Day of 2007. Although management believes that the company can achieve 30% ACV by the end of the year, developments about the shelving space and the execution of new launches remain concerns." Read the analyst note on JSDA