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On Friday, Jefferies reconfirmed its Buy rating and $33.00 price target for Celsius Holdings (NASDAQ:CELH) stock, which currently trades at $25.53, down significantly from its 52-week high of $99.62. The firm’s analysis followed Celsius Holdings’ announcement of its acquisition of Alani Nu, a rapidly expanding brand. The analyst viewed the acquisition positively, acknowledging the significant growth momentum of Alani Nu, which reported a 63% increase in the last four weeks, compared to a 5% decline for Celsius. According to InvestingPro analysis, CELH is currently undervalued.
Celsius Holdings’ fourth-quarter results showed a top and bottom-line beat, with the company reporting $1.36 billion in revenue and maintaining a strong financial position with a current ratio of 3.62. The acquisition of Alani Nu is seen as a strategic move that could lead to growth, with the combined entity predicted to hold approximately 15% market share. InvestingPro data reveals 14+ additional insights about CELH’s financial health, which currently rates as "GREAT."
The purchase price for Alani Nu is set at $1.8 billion, which the analyst notes implies a valuation of 3 times sales or 12 times adjusted and post-synergy EBITDA. This valuation is considered fair and matches the multiple Keurig Dr Pepper (NASDAQ:KDP) paid for GHOST, another player in the industry.
The integration of Alani Nu into Celsius Holdings’ portfolio is expected to bolster the company’s position in the market, leveraging the brand’s current upward trajectory. The deal is anticipated to contribute to the overall growth of the new combined company, which is now set to command a more significant share in the competitive beverage sector.
In other recent news, Celsius Holdings has announced a definitive agreement to acquire Alani Nutrition for a net purchase price of $1.65 billion. The acquisition, expected to close in the second quarter of 2025, includes $150 million in tax assets and is anticipated to be accretive to cash EPS in the first year post-acquisition. Alani Nu reported revenue of $595 million and EBITDA of $87 million for 2024, with expectations of significant synergies post-acquisition. Analysts at JPMorgan and Stifel have maintained their positive outlooks on Celsius, with JPMorgan setting a price target of $31 and Stifel at $37. Stifel analysts noted that the acquisition could boost Celsius’s sales and adjusted EBITDA by approximately 50% in 2026. Meanwhile, Jefferies adjusted its price target for Celsius to $33, citing a deceleration in growth and distribution challenges. Despite these challenges, Jefferies maintains a Buy rating, suggesting potential for growth inflection. Celsius’s recent earnings report showed an EPS of $0.14, surpassing analyst expectations, although revenue was slightly below consensus at $332.2 million.
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