Core Viewpoint - Celsius Holdings experienced a significant stock rebound in 2025, with shares increasing by 74%, contrasting with a 16% gain for the S&P 500, indicating strong consumer demand despite previous challenges [1]. Group 1: Financial Performance - In 2024, Celsius faced a 52% decline in stock value due to stalled growth, with a notable 31% drop in Q3 revenue, which management attributed to inventory fluctuations with PepsiCo [2][4]. - By 2025, Celsius reported a remarkable 75% top-line growth through the first three quarters, demonstrating a recovery in consumer interest and sales [1][6]. - The company acquired Alani Nu for $1.65 billion in April 2025, contributing to its growth, although inorganic growth raises concerns about financial and integration risks [6]. Group 2: Market Dynamics - Despite the revenue drop in 2024, Celsius maintained its market share and distribution, with retail sales of the Celsius brand growing by 13% year over year in the 13 weeks leading up to September 28, 2025 [7]. - The Alani Nu brand has not cannibalized Celsius' sales, with Alani Nu's net sales increasing by 115% year over year, indicating a complementary growth strategy [8][9]. - International revenue accounted for only 3% of total revenue in Q3, suggesting significant potential for growth in global markets [10]. Group 3: Future Outlook - Celsius is positioned for continued profitable growth, with multiple growth levers including the Alani Nu brand and international expansion [8][11]. - The current valuation of Celsius, with a price-to-sales (P/S) ratio of 6, is considered attractive compared to its 10-year average [11]. - Long-term growth prospects remain strong, with expectations for Celsius to outperform the market over a five-year horizon [13].

Core Viewpoint - Celsius Holdings is experiencing a potential recovery after significant declines, driven by its niche in the energy drink market and recent acquisitions [1][2]. Company Overview - Celsius has established a lucrative niche within the energy drink industry by targeting fitness enthusiasts rather than competing directly with larger brands like Red Bull and Monster Beverage [4]. - The company’s distribution agreement with PepsiCo in August 2022 significantly boosted sales, leading to a 75% increase in quarterly revenues since the agreement [5]. Financial Performance - Celsius stock has declined over 60% since its peak in early 2024 but has increased over 50% since the beginning of the year [2]. - In Q1 2025, Celsius reported revenue of $329 million, a 7% year-over-year decline, which is an improvement from a 31% decline in Q3 2024 [9]. - The company’s comprehensive income in Q1 2025 was $37 million, down from $63 million in the same quarter the previous year [9]. Market Position - Celsius holds approximately 11% market share, ranking third in the energy drink market, and leads in the health and fitness-oriented niche [6]. - The forward P/E ratio of 50 reflects a recovery from historical lows, suggesting a more favorable valuation compared to the peak P/E ratio of 125 [8]. Growth Prospects - Analysts forecast a 60% revenue growth in 2025, primarily due to the acquisition of Alani Nu, but expect a slowdown to 21% growth in 2026 [10]. - International sales, which accounted for 7% of revenue in Q1 2025, grew by 41% annually, indicating significant potential for future growth [10][11]. Investment Outlook - Despite potential overvaluation indicated by the forward P/E ratio, Celsius stock is considered a long-term buy due to expected demand growth and international market expansion [12][13]. - The company’s growth story is seen as ongoing, with international sales likely becoming a primary revenue driver over time [13].