Critical Analysis: Reeds (OTCMKTS:REED) & Embotelladora Andina (NYSE:AKO.B)

Reeds (OTCMKTS:REED) and Embotelladora Andina (NYSE:AKO.B) are both consumer staples companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, risk, valuation, profitability, earnings, analyst recommendations and institutional ownership.

Risk & Volatility

Reeds has a beta of 0.19, meaning that its stock price is 81% less volatile than the S&P 500. Comparatively, Embotelladora Andina has a beta of 0.62, meaning that its stock price is 38% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Reeds and Embotelladora Andina, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Reeds	0	0	0	1	4.00
Embotelladora Andina	0	1	0	1	3.00

Insider and Institutional Ownership

51.5% of Reeds shares are held by institutional investors. Comparatively, 1.6% of Embotelladora Andina shares are held by institutional investors. 0.0% of Reeds shares are held by insiders. Comparatively, 0.0% of Embotelladora Andina shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Reeds and Embotelladora Andina”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Reeds	$31.18 million	0.62	-$13.15 million	($1.59)	-1.02
Embotelladora Andina	$3,380.92 billion	0.00	$295.57 million	$2.04	14.22

Embotelladora Andina has higher revenue and earnings than Reeds. Reeds is trading at a lower price-to-earnings ratio than Embotelladora Andina, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Reeds and Embotelladora Andina’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Reeds	-42.48%	-358.36%	-59.26%
Embotelladora Andina	8.70%	24.47%	8.89%

Summary

Embotelladora Andina beats Reeds on 8 of the 11 factors compared between the two stocks.

About Reeds

Reed's, Inc. engages in the manufacture and distribution of natural beverages in the United States. The company offers Reed's craft ginger beer; Reed's real ginger ales; Reed's Classic Mules; Reed's Hard Ginger Ale; Reed's ready to drink products; and Virgil's handcrafted sodas. It sells its products to natural food and gourmet retailers, grocery store chains, mass merchants, club stores, convenience and drug stores, liquor stores, industrial cafeterias, and on-premise bars and restaurants, as well as directly to consumers through www.drinkreeds.com. The company was formerly known as Original Beverage Corporation and changed its name to Reed's, Inc. in 2001. Reed's, Inc. was founded in 1987 and is headquartered in Norwalk, Connecticut.

About Embotelladora Andina

Embotelladora Andina S.A., together with its subsidiaries, produces, markets, and distributes Coca-Cola soft drinks in Chile, Brazil, Argentina, and Paraguay. It also offers fruit-flavored beverages, juices, sports and energy drinks, ice tea, and bottled water. Embotelladora Andina S.A. was founded in 1946 and is headquartered in Santiago, Chile.