Celsius Holdings Up 70% in Three Months: How Should Investors Play?

Celsius Holdings, Inc. CELH has delivered an impressive 69.8% surge in its stock price over the past three months. CELH stock has outperformed the Zacks Food – Miscellaneous industry and the broader Consumer Staples sector, which have gained 0.3% and 4.4%, respectively. Meanwhile, the S&P 500 posted a decline of 4.7%.CELH Price Performance vs. Industry, S&P 500 & SectorImage Source: Zacks Investment ResearchCelsius Holdings has also outperformed other major players in the beverage industry, such as PepsiCo, Inc. PEP, Monster Beverage Corporation MNST and The Coca-Cola Company KO. Over the past three months, Monster Beverage and Coca-Cola posted gains of 22.3% and 0.9%, respectively, while PepsiCo saw a decline of 8.3%.Closing at $37.93 yesterday, CELH is trading above the 50 and 200-day simple moving averages of $33.85 and $31.73, respectively. This upward trajectory highlights the stock’s strong momentum and price stability, signaling positive investor sentiment. As CELH continues to outperform key technical benchmarks, investors are now evaluating their next move: should they take profits, increase their positions or hold existing shares?CELH Trades Above 50 and 200-Day Moving AveragesImage Source: Zacks Investment ResearchCelsius Holdings Growth DriversCelsius Holdings has firmly positioned itself as a key player in the energy beverage space through its flagship Celsius brand and the acquisition of Alani Nu, completed on April 1, 2025. Combined, Celsius Holdings and Alani Nu contributed approximately 20% of total dollar growth in the energy drink category during the first quarter of 2025. With distinct brand identities and strong consumer appeal, CELH is well-positioned to engage a broader audience and build lasting customer loyalty.The company’s commitment to sugar-free, better-for-you products aligns with evolving health and wellness trends. With growing demand for healthier, ingredient-conscious options, Celsius Holdings is well-positioned as a leading option in this space. Notably, sugar-free energy drinks contributed to 86% of the total growth in the energy drink category in the first quarter of 2025. Innovation remains a key pillar of growth. In the first quarter of 2025, Celsius Holdings launched new Vibe and ESSENTIALS flavors, along with CELSIUS HYDRATION, marking its entry into the $1.4 billion hydration powder market. These new products are driving household penetration and transitioning Celsius Holdings from an on-the-go option to an everyday pantry staple.The company has made significant gains in its retail footprint. Celsius Holdings expanded availability in more than 1,800 Home Depot locations and 18,000 Subway restaurants, enhancing its brand presence in foodservice and everyday on-the-go consumption moments. With a growing retail presence, Celsius Holdings is well-positioned to continue its momentum and drive further growth in both the foodservice and retail sectors.What Might Hurt Celsius Holdings Stock?The energy drink market remains fiercely competitive, and this poses a major challenge for Celsius Holdings. Dominant players like Monster Beverage and Red Bull continue to lead in shelf space, brand recognition and marketing firepower. These companies are not only raising prices but also launching new products at a rapid pace. As competition intensifies, Celsius Holdings must fight harder to maintain shelf visibility and customer loyalty. Any loss of momentum in this environment could result in market share erosion, especially if the brand fails to keep pace with innovation or consumer trends.Celsius Holdings registered a 7% year-over-year decline in revenue during the first quarter of 2025. This decline was driven by several factors, including lower product velocity. The revenue drop marks a slowdown in momentum compared to the company’s strong historical performance.Compounding these challenges are rising operating costs. Selling, general, and administrative expenses climbed to $120.3 million in the first quarter from $99 million a year earlier. This increase reflects Celsius Holdings’ ongoing investments in marketing, sales infrastructure, and global expansion. While necessary for long-term competitiveness, the rising expenses pressure margins, especially when revenue is under strain. If growth does not rebound swiftly, profitability could face continued headwinds.Celsius Holdings Estimates: Is Trouble Brewing?Reflecting cautious sentiment around CELH, the Zacks Consensus Estimate for earnings per share (EPS) has seen downward revisions. Over the past seven days, the consensus estimate has fallen 2 cents to 27 cents for the current quarter and 4 cents to 94 cents for the fiscal year, respectively. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)Image Source: Zacks Investment ResearchCELH’s Valuation PictureFrom a valuation perspective, Celsius Holdings is trading at a premium compared with industry benchmarks. The company’s forward 12-month price-to-earnings multiple of 36.5X remains above the industry average of 15.97X. Adding to these concerns, Celsius Holdings currently holds a Value Score of D, indicating potential overvaluation relative to its fundamentals. PepsiCo, Monster Beverage and Coca-Cola are all trading at lower forward P/E ratios of 16.19X, 31.26X and 22.6X, respectively.CELH P/E Ratio (Forward 12 Months)Image Source: Zacks Investment ResearchHow to Play CELH Stock?Celsius Holdings has demonstrated remarkable stock performance, significantly outpacing both the broader market and key industry peers. Its strategic growth initiatives, such as the Alani Nu acquisition, expansion into new retail channels, and product innovation, underscore its potential as a disruptive force in the energy beverage space. However, recent revenue declines, rising costs, intense competition, and valuation concerns pose near-term challenges. Given these factors, long-term investors may consider holding the stock. Currently, CELH carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report CocaCola Company (The) (KO): Free Stock Analysis Report PepsiCo, Inc. (PEP): Free Stock Analysis Report Monster Beverage Corporation (MNST): Free Stock Analysis Report Celsius Holdings Inc. (CELH): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks