Core Insights - Celsius Holdings Inc. is enhancing its position in the energy drink market through a new distribution agreement with PepsiCo, which grants it category captain status and improved control over shelf space and product placement [1][2] - The partnership includes the addition of Alani Nu and Rockstar to Celsius' portfolio, which is expected to unlock new growth opportunities [1][3] Distribution and Market Presence - The revamped deal with PepsiCo secures guaranteed visibility for Celsius, allowing control over planograms and SKU prioritization in designated coolers [2] - Alani Nu is anticipated to benefit from larger displays, while Rockstar will have an optimized assortment focused on faster-selling products [3] Sales Performance - Celsius experienced a significant surge in U.S. retail sales, with a 120.8% increase in the four weeks ending August 10 [4] - The energy drink category is witnessing a shift in consumer preferences, with sales climbing 16.7% over the past 12 weeks as consumers move away from higher-priced iced coffee [4] Financial Metrics - Celsius reported strong profitability with second-quarter EBIT margins of 27.2% and gross margins of 51.5% [5] - The company aims for mid-50% gross margins and 30% EBITDA margins, which are considered achievable with potential upside [5] Competitive Landscape - Rockstar is facing challenges, with U.S. retail sales down 11.1% in the 12 weeks ending August 10, following a 14% decline in the previous period [6] - Despite these challenges, the inclusion of Rockstar in the PepsiCo partnership is expected to enhance Celsius' bargaining power and distribution scale [6] Future Projections - Piper Sandler projects Celsius' revenue to reach $2.42 billion and earnings of $1.02 per share in fiscal 2025, increasing to $3.32 billion and $1.35 per share in 2026 [7]