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

Read the full analyst report on JDSA