Shares of Celsius Holdings (CELH) tanked to their lowest level since late January after TD Cowen lowered its price target on the energy drink company to $68 per share. The investment firm, via analyst Robert Moskow, cited sharply slowing growth trends. Other firms have also adjusted expectations based on recent Nielsen data and PepsiCo’s (PEP) inventory optimization.
However, it also didn’t help that a recent Wall Street Journal article highlighted the health concerns about energy drinks and criticized Celsius’s fat-burning and metabolism-boosting claims as misleading. In fact, Aviva Musicus, science director at the Center for Science in the Public Interest, stated that the studies used to support these claims are flawed, as they were conducted on small sample sizes and over short periods of time.
The article also noted that energy drinks, in general, were becoming increasingly popular among teenage girls and young women with eating disorders. The risk that investors should consider here is that if energy drinks start becoming associated with eating disorders, it might hurt the public’s perception of the industry, which could potentially hurt sales. Nevertheless, this potential risk appears to be low at the moment.
What Is the Stock Price Prediction for CELH?
Overall, analysts have a Moderate Buy consensus rating on CELH stock based on 10 Buys, four Holds, and zero Sells assigned in the past three months. After a significant decline from its 52-week high of $99.62, the average CELH price target of $80.67 per share implies 55.64% upside potential.
