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Sunday, 05/10/2015 3:27:58 PM

Sunday, May 10, 2015 3:27:58 PM

Post# of 57850
Pulse Beverage (OTC: PLSB.QB) is an emerging growth beverage company that manufactures and distributes Natural Cabana® Lemonade, Limeade, and Natural Cabana™ Coconut Water. Pulse Beverage has also commenced distribution of its flagship product PULSE HEART AND BODY HEALTH brand of functional beverages, originally developed by Baxter Healthcare Corp., a subsidiary of Baxter International, Inc. (NYSE:BAX). At present, the beverage industry is trending towards niche beverages that contain functional ingredients that have shown to promote health, and away from the broad consumption of carbonated soda drinks. Due to declining growth in traditional soda sales, major beverage companies are seeking to participate in the growing functional beverage sector.

Distribution
Pulse Beverage spent the majority of 2012 through 2014 building its distribution system in order to secure listings with regional and national grocery and convenience chain stores such as Albertsons/Safeway, Walmart, Kroger/Fred Meyer/Ralphs, Kmart, Circle K, Walgreens, 7-Eleven, Whole Foods, H-E-B, Hy-Vee Supermarket, Save Mart Supermarkets, Hannaford, Food City, Raley's Supermarkets, Price Chopper Supermarkets, WinCo Foods, and Gelson's Super-market.

Distribution Summed Up:
Pulse introduced Natural Cabana® Lemonade in 2012 and in just 3 years went from nothing to a multi-national distribution system with more than 150 distributors in 49 States, Canada, Mexico, Panama, Bermuda and Ireland.

As of 12/31/2014 Pulse secured approximately 20,000 Store Listings for their Lemonades/Limeades and about 5000 Store Listings for their Coconut Waters.

The Pulse team has set more than 300 Walmart stores to date; Pulse is in the process of setting 4,000 retail stores for April, May and June: more than 3,500 stores are being set for Natural Cabana® Lemonades/Limeades, 500 for Coconut Waters, and 300 for PULSE® Heart & Body Health functional beverages.

Pulse is currently negotiating with regional and national chain stores that have the potential of 13,000 additional stores selling one or all of its brands: more than 8,000 for Lemonade/Limeade, more than 7,000 for Coconut Water, and more than 5,500 for PULSE®;

They have secured nearly 3,000 Store Listings for initial distribution in Mexico. The distribution is just now getting underway.

They are already in Canada. They just recently signed an agreement with Unique Foods, a major Canadian national distributor. Recent news states an added 500 7-11 stores in Canada, all corporately owned.

***Do the math. 1+1 = 2. Pulse just launched Limeade in January, 2014, and Coconut Waters in March, 2014. That said, Pulse has spent 3.5 years setting everything up, on little to no cash too, and now it is time. Nearly doubling distribution this year, financing secured, expansion in Mexico, additional expansion internationally, and Walmart looks to be huge, and the launch of Pulse Heart & Body Health NOW this May (originally developed by Baxter Healthcare).
This looks to be their breakout year!

International Distribution Breakthroughs
Mexico is HUGE for Pulse:

The Pulse Beverage Corporation has established a Mexican wholly owned subsidiary to distribute Natural Cabana Lemonades, Limeades and Coconut Water. Mexico is a massive beverage market and has been reported as the largest consumers of soft drinks per capita in the world. Pulse’s Mexico business will be headed by Carlos Villarreal and his team. Mr. Villarreal was responsible for the Mexican introduction and distribution of Monster Energy and he built the brand from 25,000 cases per annum to over 2.5 million cases per annum in just over five years. Pulse has signed a distribution agreement with a major distribution firm in Mexico to distribute its lemonades, limeades and coconut water products. This major Mexican distributor has been in business for over 60 years and has 1300 employees, 400 delivery trucks, and more than 30 distribution centers with delivery routes covering all of Mexico. The Company (Pulse) is presently also negotiating an import distribution agreement with a major import company in China.
Expansion into Canada:
We secured a distribution agreement with Unique Foods (Canada) Inc. (“Unique Foods”) in September, 2014 to distribute Natural Cabana® Coconut Water throughout Canada. Unique Foods is headquartered in Montreal, Canada with an established presence in Atlantic and Western Canada, Ontario and Quebec through coordinators and multiple independent regional distributors. Unique Foods is a leading importer of premium beverage brands such as: Stewart’s Old Fashioned Sodas, Cascade Ice™, Hype Energy™, AQUAhydrate™ and ACTIVATE® Vitamin Drinks.


What I think:
Cases Sold in 2014 = 334,000
Q1 ’14 about 55,000
Q2 ’14 about 126,000
Q3 ’14 about 100,000
Q4 ’14 about 53,000
There are many reasons for investing in Pulse. Growth is one of them. Every quarter for 2015 that Pulse increase the amount of cases sold quarter over quarter for same period last year by 10%+ I will buy more. I will buy more because of the growth. Example; When we get Q1 ’15 #’s, if Pulse sells 10% more than 55k cases meaning they sell at least 60k, I’ll buy more because the growth is there. I encourage other investors to do the same.

I also think that with their execution through distribution this is the year they turn cash flow positive. I think that may be shown in the Q3 ’15 numbers. That is my guess. Serious buying going into these next 2 quarters is what I’ll be doing. Some of my buddies will be too.

Something to sink your teeth into:
The Pulse team are the same guys that started Clearly Canadian in the 1980’s. They took it from a start up to $178 Million in sales. I think that was over a 10 year period. However, in just 3 years, the brand went from start-up to 4.8 million cases.. in just 3 years!
The stock? Oh yeah, that went from .67 cents to over $28 dollars. I believe the stock was in the low teens when PepsiCo offered to buy them out at $19/share and Clearly Canadian turned them down!! The stock continued to run to $28.

I’m not saying Pulse will do that. I’m making a point these guys have done it before. Where do I think Pulse will be? I believe there’s potential to see multiple dollars in the next 12-18 months.

CEO Bob Yates also launched his own brand, Kwencher, and grew it to a 1.7 million case brand in less than 2 years through distribution Solely to Walmart.

Management has plenty more experience than just what I stated above. My point is these guys have done it before, and are doing it again. The stock in my opinion is undervalued and the market has it all wrong right now. I think a reason may be because the stock got ahead of itself in the past.. people were thinking way ahead of themselves on expectations. Now the market is more cautious and is wait and see mode. I’m not on that boat. Everything is aligned, set up, and it’s go time. Happy Investing.

P.S.
Coca Cola met with the Pulse team twice so far. When they met they said show us you have a viable product that sells well in the market. Coke gave Pulse a 1 million case proof on concept benchmark to prove that then talk about a buyout. I think the possibility of Coke buying out Pulse is real. I also think another beverage company may buy them out at some point.

I will get another post up like this one talking about market comparables.

Stay very disciplined and consistent.
Find what works for you and stick with it.
Identify support/resistance ranges to buy and sell.
Invest in the fundamentals, trade the technicals.

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