Peak LaCroix, An Entertaining Annual Letter from National Beverage Corp

Are we at peak LaCroix yet?

 LaCroix Cake and Cupcakes from a Whole Foods in Brooklyn

LaCroix Cake and Cupcakes from a Whole Foods in Brooklyn

National Beverage Corp (FIZZ) reported Q3 FY2017 results earlier this month, with 15% YoY Sales growth and a 62% YoY EBITDA increase. Shares are up ~115% after reaching a low of ~$39 following Glaucus Research Group's report recommending a short last September. The company is currently trading at ~26x EV/EBITDA and ~5.4 EV/Sales. Short Interest has fallen a bit recently but is still ~19% of float.

I took the liberty of reading their most recent Annual Report and Letter to Investors from the CEO, Nick Caporella (who owns ~74% of outstanding shares). Enjoy some snippets from the Letter and Annual Report:

"Since May, the beginning of our fiscal year, we have witnessed an acceleration in our momentum. Why? . . . This results from ‘exponential’ growth of distribution, both at the shelf and in new geography, and far more importantly, the impossible-to-calculate per-capita velocity of our consumers’ consumption!"
"P.S. ‘Short interest’ truly means . . . No Interest!"

This stuff reads like a comic book. I couldn't believe I was reading a ~$4B company's annual report!

With every package of Healthy Innocent LaCroix and Shasta Sparkling SDA (soft drink alternative) that is sold, we are accelerating the evolution – the transformation from once-upon-a-time acceptable – to today, technically great and smarter!”
"Someone will feature a story in the future that portrays a beautiful can of sparkling water with the word Innocent printed on it, a Tesla electric car and a Smartphone with a Health App . . . The Beginning’ the story will read! Inevitable . . . sure thing!!"
 "Today, our Company is an enterprising innovator, leaving the traditional superhighway behind. Our new course, our new pathway is called . . . ‘Inevitable’ and our vehicle’s name – ‘Exponential!’ At destiny’s resting place, we will have clearly resolved the magic of our mission . . . Indeterminable Value!’"

More to come on this company. I started a (very) small short position recently, but I think it has some room to run.

Disclosure: I am short FIZZ