DoD tests AI models that make it easy to switch from vendors like Palantir
Tuesday, Needham analysts increased the price target on Celsius Holdings (NASDAQ: NASDAQ:CELH) to $40 from $38, while retaining a Buy rating on the company’s shares. The energy drink maker, currently valued at $7.39 billion, has seen its stock surge 37.95% in the past week. The adjustment follows Celsius Holdings’ recent announcement regarding the acquisition of Alani Nu, which analysts view as a positive move for the company’s financial performance and market position. According to InvestingPro analysis, the stock currently shows potential upside based on its Fair Value calculations.
The analyst at Needham, Gerald Pascarelli, expressed optimism about the acquisition, noting that it was secured at an attractive valuation and is expected to be accretive to earnings. The company already demonstrates strong financial health with a current ratio of 3.62 and maintains an impressive gross margin of 50.18%. Pascarelli also pointed out that the deal would accelerate scale and market share advantages for Celsius Holdings. Despite new developments, the firm’s outlook on the company remains largely the same, with anticipation of improved consumer trends and higher gross margins after the first quarter of 2025.
Celsius Holdings had a better-than-expected performance in the recent quarter, which has led to an upward revision of revenue, earnings, and EBITDA forecasts by Needham. The new price target of $40 is based on a roughly fourfold target multiple of the company’s projected 2026 revenue.
Needham’s continued endorsement of Celsius Holdings as a Buy and a conviction list pick reflects the firm’s confidence in the company’s future performance and strategic growth initiatives. The acquisition of Alani Nu is seen as a catalyst that could enhance Celsius Holdings’ earnings and expedite its expansion in the market.
In other recent news, Celsius Holdings reported its fourth-quarter 2024 financial results, surpassing earnings expectations with an earnings per share (EPS) of $0.14, compared to the forecasted $0.10. The company also exceeded revenue projections, posting $332.2 million against an anticipated $327 million. Despite a 4% decline in net sales year-over-year, Celsius’s gross margin improved significantly, expanding by 240 basis points to 50.2%. In a strategic move, Celsius announced its agreement to acquire Alani Nu for $1.8 billion, a deal expected to enhance market share and contribute to future growth. Analysts from Jefferies and CFRA have shown confidence in Celsius Holdings, with Jefferies raising its price target to $40 and CFRA to $45, both maintaining a Buy rating on the stock. The acquisition of Alani Nu is projected to increase Celsius’s sales by 41% and adjusted EBITDA by 30% in 2025, according to Jefferies. CFRA noted the company’s strong balance sheet, with nearly $900 million in net cash, as a positive indicator of financial health. These developments reflect a period of strategic growth and financial resilience for Celsius Holdings.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.