Leading portfolio company of beverage brands Splash Beverage Group (NYSEAMERICAN: SBEV) has recorded a stock price increase of 118% within 24 hours, building on positive expansion news.
The growth comes after the company announced it had received authorization to sell its TapouT performance drink in Florida. The company will begin with 47 Walmart stores located in major metropolitan regions of the state.
By press time, the stock was trading at $4.18 and had crossed the 200-day moving average. For SBEV, surpassing the 200-day moving average is pointing at a trend reversal for the stock that also surged three days in a row.
If the stock manages to stick above the 200-day moving average on the current daily time frame, it will, therefore, likely sustain the sense of an overall uptrend. It will be interesting to see SBEV’s next course if it continues gaining or if it might take a minor break.
SBEV presents strong buy signals
The recent spike offers SBEV several positive signals. The company currently holds strong buy signals from both short and long-term moving averages giving an optimistic forecast for investors.
Overall, based on the technical analysis, the Splash Beverage stock strong buy proposition stems from the company’s position in the market. Although the space is filled with competition, Splash Beverage is considered distinct since it only focuses on brands that resonate with consumers.
The company is also considered an innovative player coupled with a diversified portfolio of brands, an established distribution network, and strategic acquisitions. These factors have contributed to the company’s growth in revenue.
Apart from the Florida deal, Splash Beverages in 2020 secured a distribution approval in China through a partnership with American Software Capital (ASC). The partnership will see Splash Beverage distribute its Copa Di Vino and Pulpoloco brands to the broad Chinese market.
The growth and expansion are expected to continue, driven by the potential of the beverage market and investments in its current brands, new brands, and its distribution network.
Downside to SBEV’s growth
On the downside, the company’s energy drinks portfolio might become a casualty of the focus on healthy diets. Energy drinks contain high levels of caffeine and are marketed as fatigue killers and refreshing beverages that can improve physical and mental performance.
However, this aspect might come at a price amid rapidly expanding suggestions that cite adverse health effects of energy beverages. Overall, Splash Beverage still has a strong outlook in the market.
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