What happened?

Shares of New Age Beverages (NBEV), which aims to become the world's leading healthy beverage company, are up over 21% Monday morning since the company announced an expansion with Walmart (WMT 1.51%).

So what

It requires little stretch of the imagination to understand why NBEV stock is jumping today as the young company expands its relationship and distribution with the world's largest retailer. But it's an even bigger win than many realize: After a complete redevelopment of NBEV's Marley portfolio, which was acquired by NBEV in mid-2017, the brand outsold all competitors per point of distribution last year, which was a driving force behind Walmart's decision to authorize the brand. Now each of the Marley Mate flavors will be available at Walmart stores in April.

Man holding a yerba mate spice drunk in his hands.

Marley Mate, an organic yerba mate beverage, delivers a classic drink in convenient can form and in multiple flavors. Image source: Getty Images.

Craig Thibodeau, vice president of key accounts for New Age, said in a press release,

"This is such a great accomplishment for New Age to gain its first national distribution, and to do so with the world's largest retailer in Walmart. This is just the first initiative that we expect to do with them on the Marley brand and other New Age products on which we are in active discussions. We know Walmart is equally as committed as New Age to providing healthier products for their customers, and we expect to make the full portfolio of New Age's better-for-you products available as we expand the relationship."

Now what

This offers NBEV a fantastic opportunity to ride health-targeted category growth -- Marley Mate has the least sugar, fewest calories, and fewest carbohydrates of all major yerba mate competitors. In fact, Marley was one of the company's leading brands last year when demand increased more than 70%, and management plans to put the pedal to the metal with increased marketing efforts behind the brand in 2019. NBEV will use hypertargeted GeoFraming campaigns, digital couponing, and other trial campaigns to drive foot traffic and encourage sell-through. Time will tell how NBEV's expanded relationship with Walmart plays out, but there's certainly investor optimism with Monday's Walmart development as well as the company's exploration of cannabis-infused beverages.