How Will PepsiCo’s Increased Stake Impact Celsius Holdings’ Share Price in 2025?

If you are considering whether to buy, hold, or sell Celsius Holdings, you are in very good company. This stock has been on quite a wild ride, and there is plenty to unpack before making your next move. Over just the past year, Celsius has powered up an impressive 67.2%. If you zoom out to the last five years, the returns are over 600%. That kind of performance has a way of turning heads, and yet, in the last 30 days, the share price actually pulled back by 9.0% despite closing most recently at $54.39. So what is going on?

Much of the recent tug-of-war in Celsius’s share price seems to connect back to headlines like PepsiCo stepping up its commitment by boosting its stake to 11% in a hefty $585 million deal. Partnering with a giant like PepsiCo increases the potential for wider distribution and bigger brand buzz. At the same time, some analysts are adjusting price targets with more cautious language about the near-term outlook for food and beverage stocks, reflecting worries about slower consumer demand. This demonstrates the classic balance between excitement about expansion and realism from the broader market.

But when it comes to valuation, should you be excited or hesitant? By one popular scoring system, Celsius earns just a 1 out of 6 on undervaluation checks. This may indicate that there is not deep value on display at the moment. Still, that number only tells part of the story. Next, we will look at the different ways investors judge whether a stock like Celsius is undervalued or overvalued, plus a smarter twist on valuation you will not want to miss.

Celsius Holdings scores just 1/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Celsius Holdings Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model estimates a company’s intrinsic value by projecting its future cash flows and discounting them back to today’s dollars. This helps investors gauge what the business is truly worth now, based on how much cash it is expected to generate in the future.

For Celsius Holdings, the DCF model uses a “2 Stage Free Cash Flow to Equity” approach and analyzes cash flow forecasts through 2035. Currently, Celsius produces Free Cash Flow (FCF) of $210.6 million, and this figure is expected to grow steadily, reaching $811.1 million by 2035 according to a blend of analyst estimates and extended projections. Analyst forecasts cover the next five years, with subsequent growth extrapolated by modeling.

Importantly, the DCF model calculates an intrinsic fair value for Celsius Holdings shares of $62.25, which is 12.6% higher than the most recent closing price of $54.39. This suggests the stock is currently trading at a notable discount to its projected long-term value.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Celsius Holdings.

Our Discounted Cash Flow (DCF) analysis suggests Celsius Holdings is undervalued by 12.6%. Track this in your watchlist or portfolio, or discover more undervalued stocks.

Approach 2: Celsius Holdings Price vs Earnings

For profitable companies like Celsius Holdings, the Price-to-Earnings (PE) ratio stands out as a widely used valuation tool. This metric relates the company’s current share price to its per-share earnings, serving as a quick way to gauge how the market values its profit potential. Typically, higher growth prospects or lower perceived risk will justify a higher PE ratio, while slower growth or more uncertainty leads to a lower number.

As of now, Celsius trades at a lofty PE ratio of 146.3x. To put this in context, the average PE ratio for other beverage companies is about 17.5x, while the average among direct peers is 23.5x. On first glance, this suggests that investors are paying a very steep premium for Celsius’s growth, brand strength, or other unique advantages.

However, simply comparing to industry or peer averages can miss the bigger picture. That is where Simply Wall St’s proprietary "Fair Ratio" comes in. It combines factors like earnings growth, profit margins, competitive positioning, company size, and unique risks to work out the PE ratio Celsius “deserves.” According to this approach, Celsius’s Fair Ratio is 55.3x. This is significantly below the company’s current PE, pointing to plenty of optimism already priced in. In this case, since the actual PE far exceeds the Fair Ratio, the stock appears overvalued using this method.

Result: OVERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Celsius Holdings Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives. A Narrative is simply the story you believe about a company’s future, structured into assumptions about how its revenue, earnings, and profit margins might grow. Using those assumptions, you can develop your own estimate of fair value. This approach goes beyond just looking at past numbers; it connects your outlook about Celsius Holdings, including its competitive strengths, market risks, and upcoming catalysts, directly to financial forecasts and a fair value calculation. Narratives make investing more approachable, and they are built right into Simply Wall St’s Community page, which is used by millions of investors worldwide. With Narratives, you can see how your personal fair value compares to the current share price and decide whether to buy, hold, or sell. In addition, the story updates in real time as new earnings or major news are released. For example, some community members see Celsius’s rapid international expansion and partnerships as strong reasons to forecast a fair value over $80, while more cautious investors focus on margin pressures and set their estimates closer to $33.5. The Narrative you choose helps you make informed decisions tailored to your own perspective.

Do you think there's more to the story for Celsius Holdings? Create your own Narrative to let the Community know!

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.

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