Energy drink company Celsius stock skyrocketing by a whopping 27% recently due to strong performance as well as an acquisition of a rival brand.
Celsius Stock Skyrockets
Celsius expected about $326 million in revenue last quarter, but exceeded it by bringing in a record of $332.2 million. While this certainly is great for the company, the main reason why investors are so excited is the acquisition. The energy drink space was mostly dominated by Monster, Red Bull, as well as Alani Nutrition, a smaller energy drink brand. While Celsius will still have to compete with the Monster and Red Bull giants, the company acquired Alani, which is very popular among social media influencers and consumers.
It’s safe to say that both companies are quite excited about the acquisition. John Fieldly, CEO of Celsius said “Celsius is at a defining moment in the better-for-you, functional lifestyle products movement, and we are thrilled to welcome Alani Nu to the Celsius family.” Fiedly also said that with Alani under Celsius’s wing, they expect to “broaden the availability of Alani Nu’s functional products to help more people achieve their wellness goals.” Kate Schneider, cofounder of Alani said “As Alani Nu enters this next chapter with Celsius, I have full confidence that they are the best partner to enhance Alani Nu’s growth and success while staying true to what makes it so special.”
Investors Careful about the Acquisition
While investors certainly appreciate that the stock price has jumped, many remain unconvinced. Celsius shares have been down since may of 2024. The trading price at the company’s peak was $95.15, while current prices hover in the low 30s range. The plunge in price last year was due to a lack of consumer spending on energy drinks as a whole, as well as supply issues. Due to this volatility, it’s no wonder why investors are careful about putting their money into Celsius. Bill Chappell, managing director at Truist Securities said “We believe the brands target the same audience so faster growth for Alani Nu could result in slower growth for CELH in the next few quarters.”
In the meantime, Celsius still has high goals to achieve. The company expects to drive about $2 billion in sales across all products.. This large goal comes from an attempt to shift consumer preference towards premium beverage and energy drink options. If the company hits this goal and some other lofty ones, perhaps it will persuade investors to invest.
Featured Image Credit: Renan Mandelo Oliveira; Pexels: Thank You!
