Stock Prices of Celsius Skyrocket, Raising Questions About Purchase Opportunities
Celsius Reports Strong Q2 Results Amidst International Expansion
Celsius, the popular energy drink brand, has reported impressive second-quarter results, with overall company sales climbing 84% to $739.3 million. The brand's strong performance was driven by a 27% increase in international sales, which reached $24.8 million, and a significant 87% jump in North America sales, totaling $714.5 million.
Celsius's unit sales increased by 6%, and the brand held an 11% dollar share in the energy drink category. The company's acquisition of Alani Nu contributed to these results, with Alani Nu's market share nearly doubling year over year to 6.3%. In particular, Alani Nu's retail sales soared 129% in Q2.
The Celsius brand saw a nice improvement in the quarter as it tries to regain its traction. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) surged 109% to $220.3 million, and adjusted earnings per share (EPS) for Celsius soared 68% to $0.47. Celsius's brand revenue grew 9% to $438.1 million.
However, with the stock now trading at a forward price-to-earnings ratio (P/E) of around 42.5 times 2026 analyst estimates, following its surge in price, the stock is no longer trading at the attractive valuation it was earlier this year.
Looking ahead, Celsius plans to shift Alani Nu over to PepsiCo's distribution network, which should expand its retail presence, particularly in the convenience store channel. The introduction of Limited-Time Offers (LTOs) for the first time this fall, along with increased advertising, should help drive growth for the Celsius brand.
Despite the strong results, the company expects some margin pressure in the latter half of 2025 due to higher input costs, largely stemming from aluminum tariffs. It will also increase its marketing efforts.
In conclusion, Celsius's strong Q2 results demonstrate the brand's continued growth and success, particularly in international markets. However, with the stock trading at a high P/E ratio, investors may want to consider waiting for a potential pullback before investing.
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