Koios Beverage Corp (OTCMKTS: KBEVF) is on the cusp of a bounce back after a steep pull back from this year highs. Price action indicates the stock might have hit support and due for a correction higher on improved underlying fundamentals.
KBEVF Catalysts And Price Analysis
The Company’s market sentiments have received a boost on the confirmation of a strategic partnership with Ball Corporation in bid to ramp up production levels. A deal with Full Metal Lining is poised to strengthen the company’s production capacity even further.
Koios Beverage also achieved significant progress in Q1 on its bid secure major retail distribution to drive sales through e-commerce and Amazon platforms. The company has also sought to prop its investor relations and branding distribution services if a deal with Hybrid Financial Ltd is anything to go by.
The stock has taken a significant hit after a meteoric rise in February that saw the stock surge to this year highs of $0.72. A 50% plus pull back could as well have presented an opportunity for investors who missed the initial spike to bet on further rallies on the upside in response to recent developments that underscore long term prospects.
Standing in the way of Koios Beverage resuming its upward momentum, after the steep pullback, is the $0.36 resistance level. A rally followed by a close above the resistance level should reaffirm the stock’s bounce back credentials back to this year highs.
Conversely, failure to take out the $0.36 level could attract further sell-off pressure in continuation of a downtrend that began at the end of the first quarter.
What Does Koios Beverage Do?
Koios Beverage is engaged in the development, manufacturing, and distribution of nutritional supplements and organic beverages across the U.S. The company has also diversified its footprint by venturing into the multi-billion cannabis sector with the unveiling of a line of cannabis-infused beverages.
Why is Koios Beverage a Bounce Back Candidate?
Koios Beverage bounce back prospects are gaining momentum by the day as investors react to underlying developments that point to a bright future. For starters, a deal with Ball Corporation paves the way for the company to produce over 1 million cans printed KOIOS that should allow the company to meet growing market needs.
“By printing our cans in this large of a quantity it will allow us to meet current demands, and it decreases our costs which further allows us to increase our margins substantially. This cost savings allows us to pass on an added benefit to the consumer. Securing the cans now was a crucial step to put us in the correct position to meet our sales forecasts during the next quarter,” said CEO Chris Miller.
In March, Koios Beverage also inked a new canning facility partnership with Full Metal Canning all in the effort of boosting production capacity. The deal grants the company access to high volume production line that supports the production of a lower minimum amount of product, at any given time.
In addition, a deal with Full Canning also grants Koios Beverage with two canning lines in the local Colorado market. With the improved capacity, the company should be able to produce twice the amount of product at a much more rapid pace.
Sales Growth Prospects
The need to increase production capacity comes on the heels of the company signing a retail agreement with two of the largest retailers in the world. The deals have added over 5,000 additional retail locations across the U.S that allow the company to carry Koios beverage line.
With the added retail footprint, Koios Beverage saw purchase orders for its beverage line skyrocket to $734,876 from February 1, 2019, to March 13, 2019. The company is planning to add an additional 2,500 retail locations in a bid to attract more purchase orders, which should translate to more sales. Plans are also underway to unveil an e-commerce and sales platform to service over 7,000 active clients and audience.
“Our digital reach has also increased substantially with each of our large retail partners having added Koios to their digital portfolios allowing consumers to purchase from their e-commerce platforms. There has been a substantial increase during Q1 in e-commerce sales through these two specific outlets,” Koios in a statement.
Koios Beverage has achieved significant progress on its bid to attract more sales for its Koios beverage line. With over 5000 retail locations now carrying the company’s products, the future can only be bright when it comes to sales growth.
The company is also ramping up production capacity in a bid to address growing market demands. An aggressive production and marketing campaign point to a record-setting year when it comes to revenue generation. That said the stock looks set to bounce back after the steep pullback.
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Disclosure: We have no position in KBEVF and have not been compensated for this article.