Wall Street investment bank Goldman Sachs (GS) has initiated coverage of energy drink maker Celsius Holdings (CELH) with a Buy rating and a $72 price target.
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The price target is 23% higher than where CELH stock currently trades. Goldman Sachs says the fast-growing energy drink maker should benefit as it expands internationally, taking market share and improving its margins in the process.
Analysts at Goldman Sachs write in a note to clients that Celsius is “one of the best growth stories in consumer packaged goods,” in which it now holds a 17% market share. The Wall Street firm forecasts that Celsius’ market share could reach more than 20% in 2026, fueled by new product launches.
International Opportunity
The analysts add that Celsius has plenty of room to grow internationally in coming years, given that only 3% of its sales currently come from outside its home market of the U.S. “We see a long runway of volume-led double-digit topline growth and margin expansion,” writes Goldman Sachs in its report.
Goldman Sachs does acknowledge that CELH stock has had a huge rally this year, rising 123% since January. However, the bank maintains that Celsius’ valuation remains attractive relative to its history and when compared to competitors such as Monster Beverage (MNST). “We believe the market is underappreciating upside from further share gains,” writes Goldman.
Is CELH Stock a Buy?
The stock of Celsius Holdings has a consensus Strong Buy rating among 19 Wall Street analysts. That rating is based on 16 Buy, two Hold, and one Sell recommendations issued in the last three months. The average CELH price target of $67.17 implies 14.74% upside from current levels.
