Needham analyst Gerald Pascarelli initiated coverage on Celsius Holdings, Inc. (NASDAQ:CELH) with a Buy rating and a price target of $38.
The analyst says that as the third-largest player in energy drinks, CELH is positioned to benefit from a healthier category rebound and growing demand for zero-sugar products, creating a favorable environment for revenue acceleration alongside easier year-over-year comparisons.
The analyst writes that while the company recently saw its first year-over-year share loss, they are encouraged by the category’s return to a high single-digit growth rate.
If this trend continues, CELH stands to benefit from a healthier market backdrop, easier comps, and upcoming innovations planned for 2025, adds the analyst.
Additionally, inventory optimization challenges appear to be resolving, which should improve alignment between sell-through and reported results.
The analyst estimates full year 2024 revenue and EPS of $1.365 billion and $0.68 and $1.548 billion and $0.93 in fiscal year 2025, respectively.
Last month, the company reported third-quarter earnings per share of $0.00, missing the street view of $0.04. Quarterly sales of $265.70 million (down 31%) missed the analyst consensus of $267.11 million.
Is Celsius Holdings A Good Stock To Buy?
An investor can make a few decisions when deciding whether a stock is a good buy. In addition to valuation metrics and price action which you can find on Benzinga's quote pages – like Celsius Holdings‘s page for example – there are factors like whether or not a company pays a dividend or buys a large portion of its stock each quarter.
These are known as capital allocation programs. Celsius Holdings does not pay a dividend, but obviously has a few ways it can return value to shareholders. Feel free to search Benzinga's dividend calendar for the next company that is due to pay a dividend and determine what kind of yield you can earn for holding a share of the company.
For example, if you're looking to earn an annualized return of 14.2%, you'll need to buy a share of Ellington Residential by the Dec. 31, 2024. Once done, you can expect to receive a nominal payout of $0.08 on Jan. 27, 2025.
Price Action: CELH shares are up 0.17% at $27.94 at the last check on Friday.
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