If You Invested $1,000 In This Energy Drink Stock When COVID-19 Lockdowns Started, You'd Now Have Over $41,000 — And It May Be Time To Sell

Zinger Key Points
  • An investment in a U.S. energy-drink firm in March 2020 is now worth approximately 41 times more.
  • Celsius Holdings' extraordinary growth contradicts its fundamentals, raising warning flags.

Many stocks have had astonishing growth since the outbreak of the COVID-19 pandemic in 2020, owing to massive amounts of money pumped by central banks and government stimulus, which have fueled consumer spending and the economic recovery.

But one company substantially outperformed the others — and it has nothing to do with the metaverse, cryptocurrencies, or artificial intelligence and cutting-edge platforms such as OpenAI's ChatGPT.

Instead, it produces simple energy drinks that are consumed by real people, not avatars.

A $1,000 investment in Celsius Holdings Inc. CELH made on March 16, 2020, when the world went in lockdown, would now be worth more than $41,422.

That would have resulted in an over 41-fold increase in the amount invested at that time.

No other U.S. large-cap stock had such an explosive increase during the previous three years.

The share price of Celsius Holdings rose from a low of $3.22 in March 2020 to its current level of $133.4, representing a mind-blowing gain of 4,042%.

Chart: Celsius Holdings Skyrocketed After Covid-19

What Does Celsius Holdings Do? The firm was originally known as Vector Ventures, Inc. until changing its name to Celsius Holdings, Inc. in January 2007.

Under the trademark CELSIUS®, Celsius Holdings produces energy drinks and powder sticks that can be mixed with water.

CELSIUS® beverages come in a variety of sparkling and non-carbonated flavors, including orange, watermelon, açaí, and lemon-lime. CELSIUS® contains no aspartame, no high fructose corn syrup, no GMOs, no artificial flavors or colors, and no added salt. CELSIUS® products are kosher and vegan, as well as soy, gluten, and sugar-free.

Celsius Holdings sells its products via supermarkets, convenience shops, medicine stores, nutritional stores, mass merchants, as well as health clubs, spas, gyms and e-commerce websites. 

And Why Investors Should Better Stay Away Now: It would be wise for any potential new investors to take note of the stock's remarkable surge since COVID-19, since fundamentals have not performed as the share price did.  

  • Since 2019, Celsius Holdings' annual earnings have been steadily dropping and the company has consistently missed analyst annual profit projections. 
  • In 2022, earnings per share (EPS) came in at a negative 2.63, below than the market's expectation of negative 2.42.
  • Both the past 12 month's EBITDA and earnings are negative, according to Benzinga Pro platform
  • EPS is expected to increase to $1.49 in fiscal year 2023, $2.22 in fiscal year 2024 and $3.23 in fiscal year 2025. 
  • Celsius Holdings' current stock price is 135 times the company's estimated earnings over the next 12 months (forward P/E ratio), which makes this stock extremely expensive. 
  • The amount of short positions as a percentage of float is 31%.

Most-Exposed Exchange Traded Funds to Celsius Holdings: Three thematic ETFs presently have more than 4% of their portfolio exposed to Celsius Holdings, according to Koyfin data. 

  • Advisors Series Trust - VegTech Plant-based Innovation & Climate ETF EATV, holds 1,940 shares of Celsius Holdings, corresponding to 5.03% of its portfolio. 
  • Global X Funds - Global X Health & Wellness ETF BFIT, holds 7,430 shares of Celsius Holdings, corresponding to 4.68% of its portfolio. 

  • Series Portfolios Trust - Subversive Mental Health ETF SANE, holds 199 shares of Celsius Holdings, corresponding to 4.22% of its portfolio.

  • Celsius Holdings is also included in two popular U.S. broad equity ETFs, the iShares Core S&P Mid-Cap ETF IJH and the iShares Russell 2000 ETF IWM, but with a marginal weight of roughly 0.3%.

Read Next: Up Over 2,600% In 5 Years, Wall Street Still Calls Celsius A Buy

Photo: Courtesy Celsius


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