Celsius Holdings, Inc. (CELH): A Bull Case Theory

We came across a bullish thesis on Celsius Holdings, Inc. on Uncle Stock Notes’s Substack. In this article, we will summarize the bulls’ thesis on CELH. Celsius Holdings, Inc.'s share was trading at $40.94 as of November 28th. CELH’s trailing and forward P/E were 341.17 and 26.39 respectively according to Yahoo Finance.

Celsius Holdings, Inc. develops, processes, manufactures, markets, sells, and distributes functional energy drinks in the United States and internationally. CELH delivered a headline-grabbing Q3 with 110% revenue growth, record $721 million in sales, surging profitability, and a U.S. market share that climbed to 12.1%.

The company’s partnership with PepsiCo continues to accelerate distribution, driving North American revenue up 109% and international revenue up 126% as Celsius rapidly expands into the U.K., Ireland, France, Australia, and New Zealand. Gross margin expanded to 53.4%, adjusted EBITDA rose 181%, and net income jumped 223% to $165.7 million, supported by disciplined marketing and administrative spending.

With $865 million in cash and near-zero long-term debt, Celsius entered the quarter as one of the strongest balance-sheet stories in consumer beverages, positioned for aggressive expansion and category leadership. Yet the stock collapsed 27% after earnings, revealing a sharp rupture in market sentiment. The simultaneous acquisitions of Alani Nu and Rockstar created operational strain, elevated integration costs, and raised concerns about margin compression. A reported $61 million net loss in adjusted figures turned the narrative from flawless execution to acquisition indigestion.

Analysts immediately cut Q4 profit assumptions, lowered gross margin expectations, and increased discount rates, forcing investors to question whether Celsius remains a high-growth, high-quality compounder or a hot stock stretching beyond its limits. Still, valuation models—from forward P/E to P/S to DCF—suggest the shares now trade in an undervalued zone, with intrinsic value estimated between $46 and $65. Celsius now stands at a critical inflection point: if it proves it can digest acquisitions while maintaining momentum, the selloff may mark a rare entry point; if not, the market’s 27% warning could foreshadow deeper challenges ahead.

Previously we covered a bullish thesis on Celsius Holdings, Inc. (CELH) by One-Hovercraft-1935 in May 2025, which highlighted resilient demand, strong brand momentum, and the strategic benefits of PepsiCo’s distribution despite temporary disruptions. The company’s stock price has appreciated approximately by 5.13% since our coverage. This is because the thesis played out. The thesis still stands as international expansion and portfolio additions support long-term growth. Uncle Stock Notes shares a similar view but emphasizes Q3 performance and integration challenges.

Celsius Holdings, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 52 hedge fund portfolios held CELH at the end of the second quarter which was 47 in the previous quarter. While we acknowledge the potential of CELH as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.