Celsius Holdings (NASDAQ: CELH) was once the hottest stock, winning over investors’ portfolios. This energy drink purveyor saw its share price skyrocket 7,330% during the five-year period leading up to its peak in March 2024. This was driven by incredible revenue growth.
This beverage stock is losing its buzz, as it now trades 65% below its record (as of April 22). Is this a dip worth taking advantage of or an opportunity to pass up? Where will Celsius be in five years?
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Celsius is positioned well in the marketplace
To be clear, Celsius is still growing, even though it’s not close to the same rate as in previous years. Revenue for the Celsius brand climbed 7.5% year over year in the fourth quarter of 2025.
The acquisition of Alani Nu brings a high-powered, female-targeted energy drink brand to the mix. Its retail sales soared 76.9% during the 13-week period ended Dec. 28, 2025.
This company is well-positioned. Energy drinks have put up better growth figures than the overall industry in the U.S. And consumers’ heightened preferences for sugar-free and health-focused options plays to Celsius’ benefit.
Competition is the biggest risk factor
According to data from Circana, across its entire portfolio, Celsius captures 19.8% market share in the industry. It’s significantly behind Red Bull (35.9% market share) and Monster Beverage (27.3%).
Due to its smaller position in the energy drink market, a valid argument can be made that Celsius simply doesn’t possess the same brand recognition as the leaders. And I suspect the company won’t ever get to the level of Monster or Red Bull.
The barriers to entry also seem low, which doesn’t discourage newcomers from pursuing the growth potential of the energy drink category. Costco Wholesale, for example, launched cheaper energy drinks under the Kirkland private label in late March, which hit Celsius shares.
Celsius isn’t a fad product. It has established an enviable position in a desirable end market. But there’s certainly an upper bound to the company’s ultimate potential, which is restricted by the hyper-competitive nature of the industry.
Earnings growth will drive the share price
What’s more, the valuation isn’t an obvious bargain. Shares are trading at 22.5 times analysts’ consensus forecast for 2026 diluted earnings per share (EPS).
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