TLDR
- Celsius Holdings Inc. (CELH) shares jumped 5.85% to $35.62 on Monday
- Truist upgraded CELH from Hold to Buy with a price target increase from $10 to $45
- Analysts cite the strategic acquisition of Alani Nu brand as a key growth driver
- PepsiCo’s recent $2 billion acquisition of Poppi positively impacted CELH, as PepsiCo owns a significant stake in Celsius
- The combined market share of Celsius and Alani Nu now exceeds 16% in the energy drink market
Celsius Holdings Inc. (NASDAQ) saw its stock price surge 5.85% on Monday, closing at $35.62 per share. This upward movement came after Truist, an investment research firm, upgraded the company’s rating from Hold to Buy.
The analysts at Truist also significantly raised their price target for Celsius, moving it from $10 to $45. This represents a potential upside of over 26% from Monday’s closing price.
Truist’s bullish outlook on Celsius stems primarily from the company’s recent acquisition of Alani Nu. This brand was previously seen as a competitor that was eating into Celsius’ market share.
According to Truist, this strategic acquisition will help investors look beyond Celsius’ challenges experienced in 2024 and early 2025. The move is expected to strengthen the company’s position in the competitive energy drink market.
The Alani Nu acquisition brings particular value through its strong connection with female consumers. Reports indicate that approximately 90% of Alani Nu’s customer base is female.
This acquisition transforms Celsius into a $2 billion pro forma business for 2024. Company officials expect to achieve around $50 million in synergies over the next two years from this business combination.
Celsius also benefited from positive news regarding PepsiCo, which owns a significant stake in the company. PepsiCo recently entered into an agreement to acquire prebiotic soda brand Poppi for $2 billion.
This move signals PepsiCo’s continued interest in expanding its healthy drinks portfolio. The news had a positive spillover effect on Celsius, which produces fitness and energy beverages under the Celsius brand.
International Expansion
Celsius has been actively expanding its global footprint. The company has entered several new markets including Canada, the UK, Ireland, France, New Zealand, and Australia.
These international moves are being executed in partnership with Suntory and Pepsi. The company has seen particularly strong results in Canada, where it quickly captured a 5% market share.
Management is focusing on building brand awareness in markets where Celsius doesn’t yet have a double-digit market share. These target areas include South Florida, New York City, and other large states.
Market Position
The combined market share of Celsius and Alani Nu now exceeds 16%. This positions the merged entity as a significant competitor to the established industry leaders in the energy drink space.
Celsius generated close to $1.4 billion in revenue in 2024. With the addition of Alani Nu, the fourth-largest energy drink brand in the country, the company has substantially increased its market presence.
Celsius has a robust innovation pipeline planned for the coming year. Management anticipates securing 15% to 20% additional gains in retail space this year.
The stock was included in a recent compilation of companies with potential for substantial growth. Some analysts view Celsius as having the fundamentals needed for significant price appreciation in the coming years.
Hedge fund interest in Celsius remains strong, with 33 hedge funds holding positions in the company according to recent filings. This institutional interest suggests confidence in the company’s business model and growth trajectory.
The broader market context on Monday was mixed, with the Nasdaq registering losses of 0.14%. However, the Dow Jones jumped by 1% while the S&P 500 grew by 0.55% amid investor reactions to President Trump’s new tariff agenda.
Despite this mixed market environment, Celsius was among the top performers of the day. The company stood out among stocks with market capitalizations above $2 billion and trading volumes exceeding $5 million.
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