Is Celsius stock worth getting revved up about? Celsius Holdings (NASDAQ: CELH), a rapidly growing energy drink company, has seen its stock price drop by 41% from its recent high. This is bad, right? Not necessarily. The lower valuation may make the stock attractive to new investors. Despite this dip, the company's story remains compelling.
The recent stock price decline is attributed to concerns about slowing market share growth, with Nielsen data showing a slight dip from 10.7% in May to 10.0% in June. However, such fluctuations are normal. The stock is currently trading at 52.8 times this year's expected earnings per share, which is attractive given the projected 30% annual EPS growth rate. This valuation compares favorably to competitor Monster Energy, which trades at 28 times earnings with slower growth.
Who Is Celsius?
Celsius started small in 2005 but experienced explosive growth, particularly after 2020. In the last four quarters leading to Q1 2024, the company achieved $1.41 billion in sales, a more than tenfold increase in just over three years. This growth was largely fueled by a transformative distribution deal with PepsiCo in 2022, which expanded Celsius' market reach and operational capabilities. Celsius continues to show significant growth potential and has recently expanded into Canada, with its eye on international markets.
Celsius’s business model centers on a premium portfolio of its branded energy drinks that the company markets as healthy alternatives to standard beverages in this market. Its target customers are health-conscious individuals and fitness enthusiasts.
What The Analysts Are Saying
The CELH stock price, currently $51.64, is seen as an opportunity. Wall Street is overall bullish on Celsius stock, with a consensus "Strong Buy" rating and an average price target of $80.67, implying a more than 50% upside potential. However, analysts warn that the stock will likely remain volatile due to its high growth nature and speculative interest from various investors.
Although Celsius has experienced a significant dip, its strong growth trajectory, PepsiCo partnership, and untapped international potential make it an attractive investment at current levels, albeit with the expectation of continued volatility.
Neither Julie Stoller nor Stocks.News have positions in this company.
Did you find this insightful?
Bad
Just Okay
Amazing
Disclaimer: Information provided is for informational purposes only, not investment advice. We do not recommend buying or selling stocks. Stock price discussions are based on publicly available data. Readers should conduct their own research or consult a financial advisor before investing. Owners of this site have current positions in stocks mentioned thru out the site, Please Read Full Disclaimer for details Here https://app.stocks.news/page/disclaimer
Contributing Writer
As a professional writer since 2012, Julie Stoller has covered many industries, from healthcare and technology to consumer products and industrials. She has written about IPOs, spinoffs, ETFs, stock splits, commodities, legislative actions impacting investors, and macroeconomic issues. While keeping up with the latest meme stocks and trends, Julie's special interests are discovering ...