Earnings Update: Here's Why Analysts Just Lifted Their Celsius Holdings, Inc. (NASDAQ:CELH) Price Target To US$85.53

The investors in Celsius Holdings, Inc.'s (NASDAQ:CELH) will be rubbing their hands together with glee today, after the share price leapt 21% to US$79.27 in the week following its yearly results. Celsius Holdings reported in line with analyst predictions, delivering revenues of US$1.3b and statutory earnings per share of US$0.77, suggesting the business is executing well and in line with its plan. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Celsius Holdings

Taking into account the latest results, the current consensus from Celsius Holdings' 14 analysts is for revenues of US$1.86b in 2024. This would reflect a substantial 41% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to surge 37% to US$1.07. Before this earnings report, the analysts had been forecasting revenues of US$1.80b and earnings per share (EPS) of US$1.02 in 2024. So there seems to have been a moderate uplift in sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.

With these upgrades, we're not surprised to see that the analysts have lifted their price target 23% to US$85.53per share. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Celsius Holdings analyst has a price target of US$110 per share, while the most pessimistic values it at US$33.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that Celsius Holdings' revenue growth is expected to slow, with the forecast 41% annualised growth rate until the end of 2024 being well below the historical 59% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.0% annually. So it's pretty clear that, while Celsius Holdings' revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Celsius Holdings following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Celsius Holdings analysts - going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 1 warning sign for Celsius Holdings that you need to be mindful of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.