JSDA and PLSB are not comparable investments. Yes both are non alcoholic beverage companies but that's about it. The end consumer buyer is different and they are at very different places on the life cycle curve. JSDA is a mature company that ran into hard times and lost a lot of $, diluted its shareholders while trying to find the right leader to lead them back to profitability. PLSB is a brand new company just out of the gate. For each company to "make it" they have to do very different things. JSDA has to restructure and stop losing money both on a cash flow basis and on a EPS basis. As with any company that hits hard times, JSDA's stock got over sold (crushed). If they prove that they are back to cash flow break-even and have good leading indicators for positive EPS and revenue growth then JSDA's stock will pop a lot more than it did on Friday. In other words their market cap could jump because it was over sold and not because its the next big thing in the beverage industry. Friday's move indicates to me that institutional investors think the cash flow break-even corner might be turned.
The market cap for JSDA and PLSB are where they are for different reasons. Like I said JSDA has been sitting in an over sold position for some time. PLSB on the other hand is a hot new entrant and their products serve a much broader demographic than does JSDA's. Potential buyers like Coke and Pepsi are NEVER going to buy JSDA but they may very well be interested in a company like PLSB. If PLSB's flagship product gets solid traction and they continue to build out the distribution channel then PLSB has a real shot at a very large market cap as well as being acquired by one of the big boys looking to further diversify into the next hot segment. JSDA on the other hand will always be a small niche player in the very crowded soda segment. LETS FACE IT, THE NEXT HOT SEGMENT IN THE BEVERAGE INDUSTRY IS NOT SAUSAGE FLAVORED SODA.
while your analysis is some ways rather well reasoned, you miss touching upon an intangible subject.
Cue is proven successful manager and PLSB execs, dont fulfill an investors trust tank to the top.
My mentor Buffett says to buy franchises with good management. Well, PLSB doesnt yet have an established franchise nor a mngt team with the success record one would usually look for.
In my opinion.
PLSB is a new entrant... those things come with over time. Having said that, PLSB management is more than experienced and based upon how quickly they have built out distribution I think the Vegas odd are with the management team not against. Your "trust tank" comment lacks tangible back-up.
Funny thing is, JSDA's management team has a long way to go to prove they are the real deal as well. Like I said, I own both companies. The turn around at JSDA is beginning or at least I 'bet' on that. For JSDA's management team to earn that silly franchise tag you speak of, they have to take JSDA's stock price WAY north by way of material and consistent revenue growth and profitability. That certainly isn't in the bank.