There's a bear in the New Age Beverages (NASDAQ:NBEV) camp, and this one is a Grizzly. The distributor of functional beverages came under attack this week in a Grizzly Research report, which argued that New Age Beverages investors were duped in the acquisition of the larger Morinda Holdings late last year.

The noted worrywart claims that Morinda overstated its revenue in China, is likely operating illegally in 60% of the provinces there, and could be facing Chinese regulatory shutdowns. Grizzly Research also calls into question the poor track record of New Age Beverages' CEO, the costly licensing deal it has in place for its Bob Marley-inspired line of ready-to-drink beverages, and its disappointing recent financials. The report concludes that the stock could shed 60% of its value at this point, more than wiping out last year's monster gain. 

Marley One Drop canned beverages.

Image source: New Age Beverages.

The situation is fluid  

New Age Beverages more than doubled for investors last year, surging late last summer after announcing that it would be introducing a line of CBD-infused drinks at an industry trade show. Investors chasing the handful of publicly traded marijuana-related stocks took a brief shine to New Age Beverages after that. 

The legality of CBD is as hazy as its benefits, but there's no denying that cannabidiol is trending. New Age Beverages announced last week that its rolling out CBD products in Hong Kong, its first major international expansion. It also announced an expanded licensing agreement with the family of Bob Marley and Docklight Brands to help it push into new markets as well as introduce new products. Whether or not Grizzly Research's knocks on the cash-and-stock Morinda deal are valid, it has helped open new distribution outlets for New Age Beverages' earlier product lines overseas.

The bearish report's claim seem scathing at first glance, but in the spirit of balance, Compass Point analyst Rommel Dionsio did initiate coverage of New Age Beverages with a buy rating earlier this month. His $9 price target suggests that the stock can double from current levels. Both sides can't be right, though given the stock's volatility, it wouldn't be a shock if it did manage to shed more than half of its value as well as double later this year. 

We'll learn who was right in the coming quarters. If Grizzly Research is right about Morinda peaking last year, we'll see it in the coming quarters. Many of its China-based claims will either bubble to the surface or go away. New Age Beverages did get riskier following this scathing takedown, but it's already defending itself against the claims that were raised. There's never a dull moment for New Age Beverages.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.