📊 REED Key Takeaways
Is Reed's, Inc.. (REED) a Good Investment?
Reed's faces imminent financial collapse with accelerating losses (-$6.5M net income, down 20.4% YoY), negative operating cash flow (-$5.8M), and unsustainable leverage (3.81x debt/equity). With $4.6M cash against $6.1M annual cash burn, the company has approximately 9 months of liquidity remaining without restructuring. Fundamental business deterioration is evident through declining revenue (-10.2% YoY) and a -90.5% net margin.
Fundamentals are severely challenged: double‑digit revenue decline, thin 20% gross margin, and deep operating losses driving large negative free cash flow with negative interest coverage. Liquidity is only a short‑term cushion; without a rapid turnaround, the current burn and leverage imply elevated dilution or restructuring risk.
Why Buy Reed's, Inc.. Stock? REED Key Strengths
- Positive gross profit of $697K provides minimal operational foundation
- Maintains $4.6M cash reserves offering short-term runway
- Established market presence in beverage sector with existing distribution
- $10.42M cash and 1.60x current ratio provide short-term liquidity
- Low capex needs (~$0.27M) limit fixed investment requirements
- Positive gross margin (20.4%) offers theoretical path to breakeven if overhead is reduced
REED Stock Risks: Reed's, Inc.. Investment Risks
- Imminent insolvency: $6.1M negative free cash flow burn rate against $4.6M cash balance equals ~9-month runway
- Debt service impossible: $10.2M long-term debt with -30.5x interest coverage and negative operating income
- Extreme leverage and equity erosion: 3.81x debt/equity ratio with only $2.7M equity cushion
- Liquidity crisis: 0.58x quick ratio indicates inability to meet near-term obligations without asset liquidation
- Deteriorating fundamentals: revenue declining, losses accelerating, negative operating leverage across all metrics
- Sustained operating losses and heavy cash burn (-$17.31M FCF, -50.8% margin)
- Negative interest coverage and leverage (Debt/Equity 1.12x) elevate solvency risk
- Revenue contraction (-10.2% YoY) suggests demand and/or distribution headwinds
Key Metrics to Watch
- Monthly cash burn rate and projected insolvency date
- Operating cash flow return to positive and path to profitability
- Debt covenant violations and refinancing availability
- Gross margin trend and cost structure optimization
- Revenue stabilization indicators and market demand recovery
- Operating cash flow (quarterly)
- Gross margin percentage
Reed's, Inc.. (REED) Financial Metrics & Key Ratios
💡 AI Analyst Insight
Reed's, Inc.. presents a mixed fundamental picture. Review the detailed metrics above to form your own investment thesis.
REED Profit Margin, ROE & Profitability Analysis
REED vs Market Sector: How Reed's, Inc.. Compares
How Reed's, Inc.. compares to Market sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Reed's, Inc.. Stock Overvalued? REED Valuation Analysis 2026
Based on fundamental analysis, Reed's, Inc.. shows some fundamental concerns relative to the Market sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Reed's, Inc.. Balance Sheet: REED Debt, Cash & Liquidity
REED Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Reed's, Inc..'s revenue has declined by 23% over the 5-year period, indicating business contraction. The most recent EPS of $-9.81 indicates the company is currently unprofitable.
REED Revenue Growth, EPS Growth & YoY Performance
REED Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $7.1M | -$2.0M | $-0.27 |
| Q3 2025 | $6.8M | -$4.0M | $-0.48 |
| Q2 2025 | $9.5M | -$3.2M | $-0.13 |
| Q1 2025 | $9.6M | -$1.7M | $-0.04 |
| Q3 2024 | $6.8M | -$1.4M | $-0.34 |
| Q2 2024 | $10.0M | -$3.1M | $-0.77 |
| Q1 2024 | $9.6M | -$1.7M | $-0.40 |
| Q3 2023 | $11.9M | -$1.4M | $-0.34 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Reed's, Inc.. Dividends, Buybacks & Capital Allocation
REED SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Reed's, Inc.. (CIK: 0001140215)
📋 Recent SEC Filings
❓ Frequently Asked Questions about REED
What is the AI rating for REED?
Reed's, Inc.. (REED) has a Combined AI Rating of STRONG SELL from Claude (STRONG SELL) and ChatGPT (STRONG SELL) with 88% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are REED's key strengths?
Claude: Positive gross profit of $697K provides minimal operational foundation. Maintains $4.6M cash reserves offering short-term runway. ChatGPT: $10.42M cash and 1.60x current ratio provide short-term liquidity. Low capex needs (~$0.27M) limit fixed investment requirements.
What are the risks of investing in REED?
Claude: Imminent insolvency: $6.1M negative free cash flow burn rate against $4.6M cash balance equals ~9-month runway. Debt service impossible: $10.2M long-term debt with -30.5x interest coverage and negative operating income. ChatGPT: Sustained operating losses and heavy cash burn (-$17.31M FCF, -50.8% margin). Negative interest coverage and leverage (Debt/Equity 1.12x) elevate solvency risk.
What is REED's revenue and growth?
Reed's, Inc.. reported revenue of $7.1M.
Does REED pay dividends?
Reed's, Inc.. does not currently pay dividends.
Where can I find REED SEC filings?
Official SEC filings for Reed's, Inc.. (CIK: 0001140215) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is REED's EPS?
Reed's, Inc.. has a diluted EPS of $-0.55.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is REED a good stock to buy right now?
Based on our AI fundamental analysis in May 2026, Reed's, Inc.. has a STRONG SELL rating with 88% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is REED stock overvalued or undervalued?
Valuation metrics for REED: ROE of -240.1% (sector avg: 15%), net margin of -90.5% (sector avg: 12%). Compare these metrics with sector averages to assess valuation.
Should I buy REED stock in 2026?
Our dual AI analysis gives Reed's, Inc.. a combined STRONG SELL rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is REED's free cash flow?
Reed's, Inc..'s operating cash flow is $-5.8M, with capital expenditures of $272.0K. FCF margin is -85.6%.
How does REED compare to other Market stocks?
Vs Default sector averages: Net margin -90.5% (avg: 12%), ROE -240.1% (avg: 15%), current ratio 1.11 (avg: 1.8).
Is Reed's, Inc.. carrying too much debt?
REED has a debt-to-equity ratio of 3.81x, which is above the Market sector average of 0.7x. However, the current ratio of 1.11 suggests adequate short-term liquidity.