By Sam Boughedda
Jefferies reiterated a Buy rating and $130 price target on Celsius Holdings Inc. (NASDAQ:CELH) in a note to clients on Monday.
Analysts told investors they still have a positive view on Celsius following the company's "bullish investor meetings" at Jefferies Miami Consumer Conference.
They also labeled the company "one of the best growth stories in staples with w/ material scope for (+) to ests."
At the meeting, Celsius also laid out the three stages of its transition, while Jefferies said the company is positive about the long-term Pepsi distribution opportunity. The transition plan includes building a senior executive sales team, building PEP inventories, and beginning new distribution and optimization.
"CELH Remains a Favored Growth Idea: i) Leading growth: Perhaps the best growth story in staples, we f-cast CELH to reach ~9% US mkt share by '26 (Buy Side's bar is creeping higher on timing/share) and accelerated intl. growth, which drives our ~70% three-yr ('21-24) sales CAGR (Street +60%); ii) Substantial Margin Upside: We see scope for 'MNST-like' EBITDA margins (scale/mkt share trajectory key factor) of near ~35% possible in the intermediate term (vs. JEF/Street FY24 of ~19.5%/ ~17.5%). CELH is trading at < 7x '23 EV/Sales (vs. CELH's one yr avgs. of ~9.5x). Our $130 PT is based on 50/50 DCF and 7x EV/3Q23 NTM sales multiple," wrote the analysts.