Core Viewpoint - The article discusses the reliability of brokerage recommendations, particularly focusing on Celsius Holdings Inc. (CELH), and emphasizes the importance of using these recommendations in conjunction with other analytical tools for investment decisions [1][5][10]. Brokerage Recommendations - Celsius currently has an average brokerage recommendation (ABR) of 1.40, indicating a consensus between Strong Buy and Buy, with 80% of recommendations being Strong Buy and 5% being Buy [2][14]. - The ABR is based on recommendations from 20 brokerage firms, with 16 recommending Strong Buy and one recommending Buy [2]. Limitations of Brokerage Recommendations - Studies indicate that brokerage recommendations have limited success in guiding investors towards stocks with the best price increase potential [5]. - Analysts often exhibit a positive bias due to the vested interests of brokerage firms, leading to a higher number of favorable ratings compared to negative ones [6][10]. Zacks Rank as an Alternative - The Zacks Rank, which classifies stocks from Strong Buy to Strong Sell, is presented as a more reliable indicator of near-term price performance, based on earnings estimate revisions [8][11]. - The Zacks Rank is updated more frequently than the ABR, reflecting timely changes in earnings estimates and business trends [12]. Earnings Estimate Revisions for Celsius - The Zacks Consensus Estimate for Celsius has increased by 32.4% over the past month to $1.09, indicating growing analyst optimism regarding the company's earnings prospects [13]. - This increase in consensus estimates, along with other factors, has resulted in a Zacks Rank 1 (Strong Buy) for Celsius, suggesting a potential for stock price appreciation [14].

Core Insights - Celsius Holdings' stock has increased by 43% since the release of its Q2 2025 earnings on April 7, driven by strong sales and the acquisition of Alani Nu [1][3] - A critical metric for investors is net sales, which rose to over $739 million in Q2, marking an 84% year-over-year increase, largely attributed to Alani Nu [3][6] - Celsius brand product sales grew by 9% year-over-year, significantly lower than the 129% growth of the Alani Nu brand [3][4] Sales and Distribution - The partnership with PepsiCo, established in August 2022, has been a major contributor to Celsius' sales growth, making PepsiCo essential for the company's ongoing success [4][6] - Celsius' share of the U.S. market increased by 1.8 percentage points to 17.3% in the last quarter, indicating a positive trend in market presence [7] Financial Performance - Selling, general, and administrative expenses surged by 107% year-over-year due to acquisition-related costs and increased marketing spending, which investors need to monitor closely [6]

Company Overview - Celsius Holdings Inc. (CELH) currently holds a Momentum Style Score of B, indicating a positive momentum outlook [3] - The company has a Zacks Rank of 1 (Strong Buy), suggesting strong potential for outperformance in the market [4] Price Performance - CELH shares have increased by 10.3% over the past week, while the Zacks Food - Miscellaneous industry remained flat during the same period [6] - Over the past month, CELH's price has risen by 40.33%, significantly outperforming the industry's 0.19% [6] - In the last quarter, CELH shares have surged by 69.53%, and over the past year, they have gained 47.26%, compared to the S&P 500's increases of 8.58% and 17.39%, respectively [7] Trading Volume - The average 20-day trading volume for CELH is 7,425,680 shares, which serves as a bullish indicator when combined with rising stock prices [8] Earnings Outlook - In the past two months, 10 earnings estimates for CELH have been revised upwards, with no downward revisions, leading to an increase in the consensus estimate from $0.81 to $1.09 [10] - For the next fiscal year, 12 estimates have also moved upwards without any downward revisions [10] Conclusion - Considering the positive price momentum, strong earnings outlook, and favorable trading volume, CELH is positioned as a 1 (Strong Buy) stock with a Momentum Score of B, making it a compelling investment option [12]

Core Insights - Celsius Holdings, Inc. (CELH) is focusing on product innovation as a key driver for long-term growth, aligning its offerings with consumer preferences for healthier, sugar-free, and functional beverages [1][10] - The "LIVE FIT" campaign emphasizes health and daily functionality, enhancing consumer engagement and solidifying CELH's position in the growing sugar-free beverage market [2][10] - CELH has strengthened its leadership in the sugar-free energy drink category through its Celsius and Alani brands, introducing diverse products like Celsius Essentials and seasonal offerings [3][5] Product Innovation - The company integrates innovation into its marketing strategy, launching new products such as Fizz-Free flavors, which leverage influencer collaborations and targeted social media campaigns to enhance brand engagement [4][5] - Alani Nu has shown strong performance with innovative flavors like Sherbet Swirl and Cotton Candy, contributing to incremental sales [5] - CELH's robust innovation pipeline and international expansion initiatives position it for continued success in the beverage market [5] Competitive Landscape - The health and wellness trend has intensified competition from major players like PepsiCo, Coca-Cola, and Monster Beverage, all of which are enhancing their sugar-free offerings [6] - PepsiCo is reshaping its product portfolio to focus on functionality and health, with successful products like Pepsi Zero Sugar and Gatorade Zero [7] - Coca-Cola is evolving into a total beverage company, increasing its sugar-free options and reformulating existing products to meet changing consumer tastes [8] - Monster Beverage continues to innovate with affordable energy brands and new flavors, driving growth through a strong product pipeline [9]

Core Viewpoint - Celsius Holdings has shown a significant recovery in its stock performance after reporting positive quarterly financial results, with shares increasing over 29% and reaching new 52-week highs above $55 per share, recovering from a low of $21 per share earlier in 2025 [1][2]. Group 1: Financial Performance - The company experienced a year-over-year revenue growth of 9% in the second quarter of 2025, reaching $438 million, indicating that consumer demand remains strong despite previous declines [6][9]. - Celsius had an average quarterly revenue growth of nearly 80% from 2016 to 2023, showcasing its rapid market acceptance [3]. - The second-quarter gross margin was reported at 51.5%, only slightly lower than the 52% from the same quarter the previous year, suggesting resilience in profitability [8][9]. Group 2: Strategic Acquisitions - The acquisition of Alani Nu has been a significant factor in Celsius's growth strategy, with Alani Nu's retail sales increasing by 129% [6][7]. - Alani Nu now constitutes over 40% of Celsius's overall business, providing a strong growth engine moving forward [7]. - The management has acknowledged that while Alani Nu has a lower gross profit margin, the integration of operations is expected to improve overall profitability in the long term [8][9]. Group 3: Market Opportunities - Celsius has opportunities to expand the distribution of Alani Nu, which currently holds an 11% market share compared to 6.3% for Alani Nu, indicating potential for growth [11]. - Both Celsius and Alani Nu have significant untapped potential in international markets, which could serve as a lucrative growth avenue [12]. - With a market cap of less than $14 billion, Celsius is positioned as a top player in the U.S. market, suggesting room for expansion and increased valuation if successful in new markets [12].

Core Insights - Celsius Holdings, Inc. reported its second quarter results on August 7, which are considered pivotal in the company's history, marking the first inclusion of pro forma figures for its Quality Growth Investor [1] Financial Performance - The second quarter results are significant as they provide insights into the company's financial health and growth trajectory [1] Strategic Focus - The company aims to identify and invest in the best businesses globally to build a long-term portfolio that can outperform the market [1]

Core Insights - The acquisition of Alani Nu has significantly contributed to Celsius's recent financial performance, leading to a strong turnaround in the company's fortunes [2][3][9] Financial Performance - Celsius reported a remarkable 84% increase in overall sales, reaching $739.3 million, surpassing analyst expectations of $655.7 million [5] - North American sales surged by 87% to $714.5 million, primarily driven by the addition of Alani Nu [6] - The Celsius brand also saw a 9% revenue growth to $438.1 million, with unit sales increasing by 6% [4] - Adjusted earnings per share (EPS) rose by 68% to $0.47, exceeding the analyst consensus of $0.21 [7] Market Trends - Alani Nu's retail sales skyrocketed by 129%, with its market share nearly doubling to 6.3% [3] - Celsius's retail sales increased by 29%, with a sequential growth of 17.6% [5] - The company is witnessing a growing trend of female consumers in the energy drink market, similar to trends observed in North America [6] Future Outlook - The company anticipates some margin pressure in the latter half of 2025 due to rising input costs, particularly from aluminum tariffs [8] - Increased marketing efforts, including a national TV commercial during NFL games, are planned to enhance brand awareness [8] - The integration of Alani Nu into PepsiCo's distribution network is expected to expand its retail presence [9] Valuation Considerations - The stock currently trades at a forward price-to-earnings ratio of approximately 42.5 times 2026 analyst estimates, indicating a less attractive valuation compared to earlier in the year [11] - While there are positive growth opportunities with Alani Nu, the current valuation may be considered ahead of itself [12]

Core Viewpoint - Celsius Holdings Inc's stock has reached a new 52-week high following strong second-quarter financial results, prompting analysts to raise their price targets and express increased confidence in the company's growth potential [1][4]. Financial Performance - The company reported second-quarter adjusted earnings of 47 cents per share, significantly exceeding the analyst consensus estimate of 23 cents [2]. - Quarterly revenue increased by 84% year-over-year to $739.26 million, surpassing market expectations [2]. - Revenue from the newly acquired Alani Nu brand contributed $301.2 million, while the core Celsius brand achieved a 9% year-over-year revenue growth [3]. - Adjusted EBITDA more than doubled from the previous year to $210.3 million [3]. Analyst Sentiment - Following the earnings report, several firms, including Truist Securities, Maxim Group, Citigroup, and UBS, raised their price targets while maintaining Buy ratings [4]. - Truist increased its target from $55 to $65, and Morgan Stanley raised its target from $42 to $56 [4]. Stock Performance Metrics - Celsius Holdings has a Momentum score of 94.56, a Growth score of 86.64, and a Quality score of 86.88, indicating strong price momentum, robust business growth, and sound financial health [5]. - However, the Value score is low at 12.18, suggesting the stock is trading at a premium valuation compared to peers [6]. - As of the latest data, Celsius shares closed at $54, with a 52-week high of $54.49 and a low of $21.10 [6].

Core Viewpoint - The performance of Celsius Holdings Inc. in international markets is crucial for assessing its financial resilience and growth prospects, especially given its significant global presence [1][2][3]. Group 1: Financial Performance - The total revenue for Celsius in the quarter ended June 2025 was $739.26 million, reflecting an increase of 83.9% compared to the same quarter last year [4]. - Revenue from Europe accounted for 2.5% of total revenue, amounting to $18.3 million, which was a decrease of 13.96% from the expected $21.27 million [5]. - Asia-Pacific contributed $4.38 million, or 0.6% of total revenue, exceeding the consensus estimate by 182.65% [6]. - Other International markets generated $2.12 million, representing 0.3% of total revenue, which was below the expected $2.61 million by 18.7% [7]. Group 2: Revenue Projections - Analysts project that Celsius will achieve revenues of $641.63 million for the ongoing fiscal quarter, an increase of 141.4% from the previous year, with contributions from Europe, Asia-Pacific, and Other International expected to be $20.71 million, $1.59 million, and $2.23 million, respectively [8]. - For the full year, total revenue is anticipated to reach $2.21 billion, up 62.8% from the previous year, with Europe, Asia-Pacific, and Other International expected to contribute $79.29 million, $8.83 million, and $9.34 million, respectively [9]. Group 3: Market Dynamics - The reliance on international markets presents both opportunities and challenges for Celsius, necessitating close monitoring of international revenue trends to forecast future performance [10]. - The interconnectedness of global economies and the complexities of international operations, including currency fluctuations and geopolitical risks, are critical factors influencing the company's financial outcomes [3][10]. Group 4: Stock Performance - Over the past month, Celsius' stock price increased by 15.2%, outperforming the Zacks S&P 500 composite, which rose by 2.7% [13]. - In the last three months, the stock price surged by 31.9%, while the S&P 500 index increased by 13.2% [13].

PART I - FINANCIAL INFORMATION [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) The acquisition of Alani Nu on April 1, 2025, significantly expanded the company's total assets to **$3.8 billion**, fueled by new debt and stock, driving an **83.9% revenue increase** to **$739.3 million** in Q2 2025 Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$3.795B** | **$1.767B** | | Cash and cash equivalents | $615.2M | $890.2M | | Goodwill | $802.2M | $71.6M | | Brands-net | $1.104B | $907 | | **Total Liabilities** | **$1.704B** | **$542.5M** | | Long-term debt | $862.9M | $0 | | **Total Stockholders' Equity** | **$1.267B** | **$399.9M** | Condensed Consolidated Statements of Operations Highlights (in thousands, except per share amounts) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenue | $739.3M | $402.0M | $1,068.5M | $757.7M | | Gross Profit | $380.9M | $209.1M | $553.2M | $391.3M | | Income from operations | $143.0M | $94.2M | $195.0M | $177.4M | | Net income | $99.9M | $79.8M | $144.3M | $157.6M | | Diluted EPS | $0.33 | $0.28 | $0.48 | $0.55 | Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $147.1M | $174.3M | | Net cash used in investing activities | $-1.277B | $-13.7M | | Net cash provided by (used in) financing activities | $852.3M | $-12.6M | | **Net (decrease) increase in cash** | **$-275.0M** | **$147.2M** | [Notes to the Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) Detailed notes reveal the **$2.05 billion Alani Nu acquisition**, funded by a **$900 million term loan** and stock, significantly increased goodwill and intangibles, while highlighting North American revenue dominance and a **$56.9 million legal liability** - On April 1, 2025, the Company completed the acquisition of Alani Nutrition LLC ("Alani Nu") for a total consideration of **$1.275 billion** in cash, **22.45 million shares** of common stock, and up to **$25 million** in contingent cash consideration[32](index=32&type=chunk) - To fund the Alani Nu acquisition, the company entered into a credit agreement for a **$900 million term loan facility**, which was fully drawn on the closing date, and a **$100 million revolving credit facility**[33](index=33&type=chunk)[105](index=105&type=chunk) - The company has a long-term distribution agreement with PepsiCo Inc. ("Pepsi"), making Pepsi the primary distributor for Celsius products in the U.S. and Canada; Pepsi is also a significant related party, holding Series A Convertible Preferred Stock[34](index=34&type=chunk)[35](index=35&type=chunk)[77](index=77&type=chunk) Revenue by Geography (in thousands) | Region | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | North America | $714.5M | $382.4M | $1,021.0M | $721.9M | | Europe | $18.3M | $16.7M | $37.0M | $30.8M | | Asia-Pacific | $4.4M | $860 | $6.6M | $1.5M | | Other | $2.1M | $2.1M | $4.0M | $3.5M | | **Total Revenue** | **$739.3M** | **$402.0M** | **$1,068.5M** | **$757.7M** | - The Alani Nu acquisition resulted in the recognition of **$728.9 million** in goodwill and **$1.215 billion** in intangible assets, primarily consisting of the Alani Nu brand (**$1.104 billion**, indefinite life) and customer relationships (**$111 million**, 5-year life)[90](index=90&type=chunk)[95](index=95&type=chunk) - For the period from April 1, 2025, to June 30, 2025, Alani Nu's operations generated approximately **$301.2 million** of revenue and **$93.6 million** of net income before tax[96](index=96&type=chunk) - Regarding the Strong Arm Productions (Flo Rida) lawsuit, the company has accrued a liability of **$56.9 million**, representing the low end of a possible loss range of **$56.9 million** to **$99.3 million**, following a court decision to retrial on the damages amount[178](index=178&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=36&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes Q2 2025's **83.9% revenue growth** to the Alani Nu acquisition, which also impacted gross margin and significantly increased SG&A, while liquidity remains strong despite acquisition-related cash usage and new debt [Results of Operations](index=38&type=section&id=Results%20of%20Operations) Q2 2025 revenue surged **83.9%** to **$739.3 million**, primarily from North America and Alani Nu, though gross margin slightly declined and SG&A expenses more than doubled due to acquisition costs and marketing Q2 2025 vs Q2 2024 Performance Summary | Metric | Q2 2025 | Q2 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | $739.3M | $402.0M | +83.9% | | Gross Profit | $380.9M | $209.1M | +82.1% | | Gross Margin | 51.5% | 52.0% | -0.5 p.p. | | SG&A Expenses | $237.9M | $114.9M | +107.1% | | Net Income (to Common Stockholders) | $85.7M | $66.7M | +28.5% | - The increase in North American revenue for Q2 2025 was primarily driven by the acquisition of Alani Nu, which contributed approximately **$301.2 million** of revenue[198](index=198&type=chunk) - The increase in SG&A expenses for Q2 2025 was driven by the inclusion of Alani Nu's operations, **$16.0 million** in acquisition-related costs, a **$13.8 million** remeasurement of contingent consideration, and increased marketing for the 'Live. Fit. Go.' campaign[203](index=203&type=chunk) - For the six months ended June 30, 2025, net income attributable to common stockholders decreased to **$119.9 million** from **$131.5 million** in the prior year, primarily due to higher SG&A, acquisition costs, interest expense, and other charges related to the Alani Nu acquisition, which offset revenue growth[218](index=218&type=chunk) [Liquidity and Capital Resources](index=42&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, the company maintained **$615.2 million** in cash, with the **$1.26 billion Alani Nu acquisition** primarily funded by a new **$900 million term loan**, ensuring sufficient liquidity for future operations - As of June 30, 2025, the company had cash and cash equivalents of approximately **$615.2 million** and net working capital of **$731.4 million**[219](index=219&type=chunk) - Cash used in investing activities increased by **$1.26 billion** year-over-year, primarily due to the cash paid for the Alani Nu acquisition[225](index=225&type=chunk) - Cash provided by financing activities was **$852.3 million** for the first six months of 2025, mainly from the proceeds of the **$900 million term loan** used to fund the Alani Nu acquisition[223](index=223&type=chunk)[226](index=226&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=44&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces commodity price risk for raw materials and significant interest rate risk from its new **$900 million variable-rate term loan**, with a **1% rate increase** impacting annual debt service by approximately **$9.1 million** - The company faces commodity price risk from fluctuations in the costs of raw materials, including aluminum cans and sweeteners[232](index=232&type=chunk) - The company is subject to interest rate risk from its new **$900.0 million variable-rate term loan**; a hypothetical **1% increase** in the interest rate would increase annual debt service costs by approximately **$9.1 million**[233](index=233&type=chunk) [Item 4. Controls and Procedures](index=45&type=section&id=Item%204.%20Controls%20and%20Procedures) Management confirmed effective disclosure controls as of June 30, 2025, with the recently acquired Alani Nu excluded from internal control over financial reporting assessment per SEC guidance - The CEO and CFO concluded that disclosure controls and procedures were effective as of June 30, 2025[236](index=236&type=chunk) - Following SEC guidance for recent acquisitions, management has excluded Alani Nu from its assessment of internal control over financial reporting for the period; Alani Nu represented approximately **15%** of consolidated total assets and **28%** of consolidated revenue for the six months ended June 30, 2025[237](index=237&type=chunk)[238](index=238&type=chunk) PART II - OTHER INFORMATION [Item 1. Legal Proceedings](index=46&type=section&id=Item%201.%20Legal%20Proceedings) Legal proceedings, detailed in Note 15, include ongoing securities class actions, derivative actions, and a **$56.9 million accrued liability** for the Strong Arm Productions lawsuit - Information regarding legal proceedings is detailed in Note 15, "Commitments and Contingencies," within the financial statements[241](index=241&type=chunk) [Item 1A. Risk Factors](index=46&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the company's risk factors from those set forth in the 2024 Annual Report - There have been no material changes to the company's risk factors from those set forth in the 2024 Annual Report[242](index=242&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=46&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q2 2025, the company repurchased **24,894 common shares** at an average price of approximately **$35.88 per share** to satisfy employee tax withholding obligations, not as part of a public plan Issuer Purchases of Equity Securities (Q2 2025) | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2025 | 4,391 | $37.24 | | May 2025 | 20,503 | $35.65 | | June 2025 | 0 | N/A | | **Total** | **24,894** | **~ $35.88** | [Item 5. Other Information](index=46&type=section&id=Item%205.%20Other%20Information) During the quarter ended June 30, 2025, no officers or directors adopted or terminated any Rule 10b5-1 trading arrangements - During the quarter ended June 30, 2025, no officers or directors adopted or terminated any Rule 10b5-1 trading arrangements[246](index=246&type=chunk) [Item 6. Exhibits](index=47&type=section&id=Item%206.%20Exhibits) This section provides an index of all exhibits filed with the Form 10-Q, including the Credit Agreement related to the Alani Nu acquisition and the 2025 Omnibus Incentive Compensation Plan - Lists exhibits filed with the report, including the Credit Agreement dated April 1, 2025, and the 2025 Omnibus Incentive Compensation Plan[248](index=248&type=chunk)