Health-focused energy drink and beverage maker Celsius Holdings (CELH) reversed lower Tuesday after serving up better-than-expected Q3 results. CELH stock rallied last week on an announcement of a three-for-one stock split. Rival Monster Beverage (MNST) fought to hold gains that followed its earnings beat last week.
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The Boca Raton, Fla.-based company has been a fast riser in the potent energy drink market, offering a wide variety of sparkling and noncarbonated energy drinks, pre- and post-workout supplements, and powdered mixed drinks in a variety of flavors.
Celsius Holdings’ earnings surged to 89 cents per share from a loss of $2.46 per share last year. This marked three consecutive quarters of triple-digit earnings growth. Revenue also leapt 104% to a record $384.8 million, slightly slowing from its torrid pace of 112% growth for Q2 results in August.
According to FactSet analysts, they expected earnings to improve to 51 cents per share on 87% sales growth to $352 million.
Gross margins rose by 860 basis points to 50.4% for the period.
Celsius claimed the title for the highest-selling energy drink on Amazon.com (AMZN) for the 14-week period ending Sept. 30. It claimed a 21.4% share of the energy drink category over that span, ahead of Monster at 18.6% and Red Bull at 13%.
The company touts itself as the top dollar and unit growth brand at U.S. multi-outlet with convenience store locations (MULOCs) over the last 52 weeks.
Celsius is the No. 3 energy drink at U.S. MULOCs for the four-week period ending Oct. 8 with a 10.5% market share, more than doubling the 4.4% share for the same period last year, the company said.
Celsius Stock Split
Celsius announced last Thursday that its board of directors approved a three-for-one stock split for its CELH common shares.
At the close on Nov. 13, each Celsius stockholder will receive two additional shares for each share they hold. The company expects Celsius common stock to trade on a split-adjusted basis at market open on Nov. 15.
Stock splits spread the total market value of a company across more shares, which typically lowers the per-share price. Splits generally aim to entice price-sensitive investors to buy the stock.
CELH Stock
Celsius shares fell 3.8% in volatile trading Tuesday after surging more than 4.5% in the morning. Shares leapt 7.4% premarket. The stock rallied nearly 10% last week, with gains accelerating after the stock-split news.
CELH stock slid just below its 50-day moving average on the decline. Shares are in a buy zone above an early entry at 175.63, and almost 17% below a standard entry at 206.85 in a nine-week cup pattern.
CELH stock has fallen from all-time highs in September, but it has still soared nearly 71% this year.
MNST stock ticked lower early Tuesday. The stock climbed 1.5% Monday, marking six consecutive days of gains. Shares jumped 5.5% Friday after reporting a 43% earnings increase to beat FactSet estimates, with a boost from its recent acquisition of Bang Energy. Revenue rose 14% to a record $1.856 billion, but was just shy of forecasts.
MNST stock is in a consolidation with a 60.47 buy point. Monster shares are up nearly 11% so far this year.
You can follow Harrison Miller for more stock news and updates on X/Twitter @IBD_Harrison
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