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CELH

Celsius Holdings NasdaqCM:CELH Stock Report

Last Price

US$90.68

Market Cap

US$6.9b

7D

2.4%

1Y

-3.7%

Updated

02 Oct, 2022

Data

Company Financials +
CELH fundamental analysis
Snowflake Score
Valuation1/6
Future Growth6/6
Past Performance3/6
Financial Health6/6
Dividends0/6

CELH Stock Overview

Celsius Holdings, Inc. develops, processes, markets, distributes, and sells functional drinks and liquid supplements in North America, Europe, Asia, and internationally.

Celsius Holdings, Inc. Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Celsius Holdings
Historical stock prices
Current Share PriceUS$90.68
52 Week HighUS$118.19
52 Week LowUS$38.31
Beta1.91
1 Month Change-5.90%
3 Month Change37.48%
1 Year Change-3.73%
3 Year Change2,664.63%
5 Year Change1,530.94%
Change since IPO88.92%

Recent News & Updates

Sep 22

Celsius: Great Execution, But Expensive Valuation

Summary Celsius’s transition to a direct-store-delivery model from a wholesale direct model has resulted in very strong growth in the past couple of quarters. The company’s strong operating efficiency has resulted in strong operating leverage, and improving operating margin. The biggest risk I see is its expensive valuation. Investment Thesis Celsius Holdings (CELH) is an energy beverage drink company that is achieving remarkable growth rates due to the shift towards a healthier lifestyle, its growing product portfolio, and expanding distribution footprint as a result of its direct-store-delivery ("DSD") model via premier distributors. However, despite the exceptional execution, I believe its high valuation makes this a poor investment for now. Accelerating Growth Rates Celsius Holdings Quarterly Report Celsius's growth has been mind-boggling since its transition from a wholesale direct model to a DSD model as its revenue accelerated from 80% Y/Y growth from 3Q20 to 137% in 2Q22. In the past, their products were selling too quickly and they could not get them restocked in time via a wholesale direct model. Using a DSD model solves lots of issues as the company is working with premier distributors such as MillerCoors, Big Geyer, and more recently, PepsiCo (PEP). These distributors helped to expand Celsius's in-store presence by making its products visible on retailers’ shelves, and importantly, eliminating the out-of-stock issue. This ultimately helps the company to scale very quickly with little to no bottlenecks. Here’s what the management has to say in the 2Q20 earnings call: “​​Continue to work with key retailers to flip them over from a wholesaler direct model to the DSD partners. Just due to the velocity, we're seeing better in-stocks, better placements, better execution, Celsius is just turning at such a high rate we really need that additional touchpoints at retail” Aside from the DSD model, the growth was also driven by other factors such as its growing product portfolio and customers adopting more products, and the shift towards a healthier lifestyle puts the company as a favorable brand for consumers looking for healthier options. Celsius Holdings Quarterly Report/Press Releases/Earnings Transcripts Celsius Holdings Quarterly Report/Press Releases/Earnings Transcripts Over time, the number of premier distributors grew very quickly to 276 in 4Q21 (it stopped reporting the figures afterward), and the DSD model has resulted in an acceleration in the number of U.S. locations with its growth peaking at 96% Y/Y in 2Q22. This shows how quickly Celsius is growing its presence in the U.S. and it speaks to the importance of having premier distributors. As Celsius’ presence continues to enlarge, it will become an increasingly essential partner to these distributors due to its large sales volume, and this means that distributors may likely prioritize its products on retailers’ shelves. Celsius Holdings-PepsiCo Investor Presentation Celsius Holdings-PepsiCo Investor Presentation More recently, as most investors would’ve already known, Celsius and PepsiCo announced a long-term partnership agreement. It is clear that PepsiCo’s distribution advantage is the key to why Celsius has decided to pursue this deal. Moreover, securing this agreement with PepsiCo enables Celsius to further penetrate both the existing channels and tap into new channels. The twin engine of Celsius’s powerful brand and the instrumental role that premier distributors play will accelerate its market share. And in my view, PepsiCo receiving equity may indicate that they are confident in Celsius's growth trajectory, and having a stake in the company allows them to benefit from future share price appreciation. Overall, this is a win-win partnership. Profitability Celsius Holdings Quarterly Report Celsius Holdings Quarterly Report (Source: Celsius Holdings Quarterly Report) Its gross profit dollars also have been growing quickly with increasing revenue, although, the gross margin has been declining over time. This is primarily due to the higher can prices, and other factors including lower-margin club channel sales, and inflation in the supply chain in relation to higher freight costs, which are not exclusive only to Celsius, but to the entire beverage industry. However, gross margins are expected to resume to 40% by 4Q22. Celsius Holdings Quarterly Report Celsius Holdings Quarterly Report

Sep 12
Do Celsius Holdings' (NASDAQ:CELH) Earnings Warrant Your Attention?

Do Celsius Holdings' (NASDAQ:CELH) Earnings Warrant Your Attention?

Investors are often guided by the idea of discovering 'the next big thing', even if that means buying 'story stocks...

Aug 18

Celsius Holdings Has Been Blessed By Big Beverage - Resist The Urge To Sell

Celsius Holdings has just been blessed by PepsiCo with a massive $550 million investment and distribution deal. Now that the company has been legitimized by big beverage, the expanded distribution should add considerable value for shareholders over the long term. The recent earnings report showed continued revenue growth and increased EPS, both of which should get an additional boost from Pepsi's handling of distribution in coming quarters. Even though the stock is currently trading near all-time highs, the risks have been diminished substantially. Pepsi's involvement is a game-changer for the company. I currently view CELH as a Hold, but buying on meaningful pullbacks could be a smart strategy for investors. Investment Thesis Celsius Holdings (CELH) was the subject of my first Seeking Alpha article, in which I highlighted the stock as my highest conviction idea for 2021. Although I have been invested in the company since early 2020, the stock has come a long way and is by far the best performing holding in my main portfolio. Now that Celsius has been blessed by PepsiCo (PEP) with a massive $550 million investment and distribution deal, the bullish case for the stock has never been stronger. Short interest remains elevated at just over 16%, which is quite high given the recent news of Pepsi's major investment in the company. While speculating on short-squeezes is not part of my investment strategy, it is worth noting that many short-sellers are continuing to target the company despite continued outperformance. The recent earnings report from Celsius surprised to the upside once again, and the best is most likely yet to come. The PepsiCo distribution deal should add considerable value for shareholders over the long-term, as the product will soon reach a large percent of the U.S. population, with major advertising dollars going to promoting the brand on a larger scale. C-stores, gas stations, gyms, as well as new retail stores will likely contribute to explosive revenue growth in the years ahead, continuing the trend that has been in place. With distribution being handled by Pepsi, the company can focus more on operating efficiencies. Resisting the urge to sell will be paramount for long-term holders of the stock, as the backing of a company like PepsiCo is a bullish development that should not be overlooked. However, risk tolerance is also an important thing to consider here, as Celsius continues to be a volatile stock with a high beta and is prone to volatile price movements. In my opinion, now that PepsiCo has a vested interest in making sure the company does well, Celsius should not be viewed as a speculative investment, as it may have been in previous years. Taking advantage of short-term price fluctuations and buying more shares on pullbacks could prove to be a winning strategy for long-term shareholders. Introduction Celsius Holdings has been my highest conviction stock for over two years, and during this time it has become my first twenty-bagger in the stock market, with more gains on the horizon. In my first-ever Seeking Alpha article, I suggested that the company could one day rival Monster Beverage (MNST) and take on other big industry players like Red Bull, as the company was showing rising market share and explosive revenue growth. The growth story played out almost exactly as I thought it would over this time frame, and now that the company has been tapped by beverage giant PepsiCo with an 8.5% equity stake and distribution deal, the next several years could prove to be truly monumental. One important thing I can stress to readers is that doing 'boots-on-the-ground' research is highly valuable for market participants considering an investment in any company, as it definitely was in my case with Celsius Holdings. This type of research can give you an upper hand against others who may judge a stock based on a single variable, such as P/E or other valuation metrics. Clearly, big beverage has found value in the company despite the high valuation, and others have begun to finally take notice. While competition is somewhat of a risk factor going forward, the risks are not as great as they were in early 2020 when the company was viewed as an underdog in the energy drink space. However, the surging U.S. dollar, inflation, and recent increase in fuel costs continue to hurt Celsius' margins, as I correctly predicted in my first article on the company. A much bigger risk, in my opinion, is competition from new entrants to the market, such as Ghost Energy and a slew of other newer products. However, over the last few years Celsius has proven that it can be a top three competitor in the energy drink market, and has also just been added to the S&P MidCap 400 Index. With PepsiCo's distribution, Celsius still has a long growth runway ahead and resisting the urge to take profits now could prove to be wise in the long-term. Celsius From A Technical Standpoint Celsius stock touched overbought territory over a long-term time frame on the back of the announcement of PepsiCo's investment in the company on August 1st, 2022. Since then, some selling has occurred as short-term speculators took profits and the earnings report came out, which showed another EPS beat and continued North American revenue growth. CELH Weekly Chart (AlphaBot) The RSI is currently showing a level of 65.51, which suggests that the recent volume spikes were enough to push the stock into overbought territory briefly, but now that the price has corrected to just under $100 per share, the overbought conditions are beginning to subside. This situation could present investors with some buying opportunity in the near-term if the selling persists, and while the stock is near all-time highs, the technical picture remains strong. Since August 1st, 2022, the stock corrected slightly from being overbought and has held onto the gains, beginning to put in a base near the $100 level. CELH Since Pepsi's Investment (Google) Another interesting point to bring up is that PepsiCo's stock has actually surged more than Celsius's stock over the same time frame. While CELH has remained mostly flat since the announcement, PEP has surged almost 2% to within 6 cents of a new all-time high as of this time of writing. This tells me that the market is responding positively to PepsiCo's investment in the company, and value is being created for all parties involved. Sentiment is decidedly positive, and I view Pepsi as a logical choice for handling the distribution of Celsius's products, even though I was initially skeptical of a deal getting done between the two companies. PepsiCo is actually one of the first stocks I ever bought, and I continue to be long the shares. Once more selling hits the market and the technical picture begins to look more inviting, I will undoubtedly be looking to add to my stake in both companies. Pepsi's Big Bet - Why Both Stocks Could Be Buys Soon The synergy between Pepsi and Celsius is an interesting development in the business and accomplishes a few notable things for both companies. For one, it further expands Celsius's reach into new market segments within North America and reinforces my ideas about the company's ability to reach a huge percent of the U.S. population within the next couple years. This was a topic I brought up in my previous article on the company, in which I extrapolated into the future and gave some thoughts on Celsius's recent wins in the industry. To quote myself - "While there are still many physical locations that do not carry Celsius yet, the company will likely start to hit a huge percent of the US population in terms of reach within the next year or two. If the company does not have to worry about expanding inventories and distribution, they can focus on operating efficiencies maximizing profit margins. However, the company is at this point nowhere close to being done in terms of scaling up." Source: Author

Shareholder Returns

CELHUS BeverageUS Market
7D2.4%-3.0%-2.5%
1Y-3.7%4.6%-23.2%

Return vs Industry: CELH underperformed the US Beverage industry which returned 4.6% over the past year.

Return vs Market: CELH exceeded the US Market which returned -23.2% over the past year.

Price Volatility

Is CELH's price volatile compared to industry and market?
CELH volatility
CELH Average Weekly Movement10.2%
Beverage Industry Average Movement4.9%
Market Average Movement6.8%
10% most volatile stocks in US Market15.5%
10% least volatile stocks in US Market2.8%

Stable Share Price: CELH is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 10% a week.

Volatility Over Time: CELH's weekly volatility (10%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
2004225John Fieldlyhttps://www.celsiusholdingsinc.com

Celsius Holdings, Inc. develops, processes, markets, distributes, and sells functional drinks and liquid supplements in North America, Europe, Asia, and internationally. It offers various carbonated and non-carbonated functional energy drinks under the CELSIUS Originals name; dietary supplement in carbonated flavors, including apple jack’d, orangesicle, inferno punch, cherry lime, blueberry pomegranate, strawberry dragon fruit, tangerine grapefruit, and jackfruit under the CELSIUS HEAT name; and branched-chain amino acids functional energy drink that fuels muscle recovery under the CELSIUS BCCA+ENERGY name. The company also provides CELSIUS On-the-Go, a powdered form of the active ingredients in functional energy drinks in individual On-The-Go packets and canisters; and sparkling grapefruit, cucumber lime, and orange pomegranate, as well as pineapple coconut, watermelon berry, and strawberries and cream non-carbonated functional energy drinks under the CELSIUS Sweetened.

Celsius Holdings, Inc. Fundamentals Summary

How do Celsius Holdings's earnings and revenue compare to its market cap?
CELH fundamental statistics
Market CapUS$6.86b
Earnings (TTM)US$18.41m
Revenue (TTM)US$486.57m

372.6x

P/E Ratio

14.1x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
CELH income statement (TTM)
RevenueUS$486.57m
Cost of RevenueUS$294.02m
Gross ProfitUS$192.55m
Other ExpensesUS$174.14m
EarningsUS$18.41m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)0.24
Gross Margin39.57%
Net Profit Margin3.78%
Debt/Equity Ratio0%

How did CELH perform over the long term?

See historical performance and comparison