Celsius Holdings (CELH) Stock Still Looks Expensive After a 54% Fall

Celsius Holdings has given shareholders a rough three year ride, with the share price down 54.4%, while current valuation checks still suggest the stock screens on the expensive side rather than as a clear bargain.

• Over the past three years the stock has fallen 54.4%, which means anyone buying at earlier peaks has seen a large hit to capital so far.
• The company’s ability to support its current market value may hinge on how well it can convert revenue into durable margins and cash flow, while any slowdown in growth or pressure on profitability could make the present pricing look demanding.
• On a broad set of valuation checks Celsius Holdings scores only 2 out of 6, which points to a stock that currently leans expensive rather than one that clearly trades on the cheap.

The issue now is whether the current share price already reflects the risks around growth, margins and cash generation, or if investors are still paying too much for what Celsius Holdings is likely to deliver.

Broaden your watchlist beyond Celsius Holdings by comparing its recent share price slide with hand picked 47 high quality undervalued stocks that currently screen as better value on key fundamentals.

Does Celsius Holdings Look Pricey on Earnings?

The P/E ratio is a useful way to judge what you are paying today for each dollar of Celsius Holdings earnings. It puts the current share price directly against the company’s profit line.

Celsius Holdings trades on a P/E of about 118.7x, which is far higher than the Beverage industry average of 17.1x and also well above the peer group average of 35.2x. A tailored fair P/E for the company, which blends its growth profile, margins, size and risk, sits closer to 30.9x. That is a large gap to the current multiple and indicates a valuation that already reflects very optimistic expectations around future profitability.

Within this framework, the model is not suggesting a small premium. It is indicating that the current earnings multiple is very stretched compared with what would typically be paid for a business with similar characteristics.

On a P/E basis, Celsius Holdings stock currently screens as overvalued relative to both its industry and a more tailored fair multiple.

See what the numbers say about this price — find out in our valuation breakdown.

The Celsius Holdings Narrative: What Would Justify Today's Price?

Simply Wall St Narratives pick up where the Celsius Holdings valuation puzzle leaves off by spelling out which paths for growth, margins and earnings would need to hold for the stock to be worth significantly more or less than today's price. Each one lays out its own set of assumptions behind a fair value so you can compare those expectations with the actual results as they are reported on Celsius Holdings' Community page.

Celsius Holdings splits opinion sharply, with community narratives painting either a mispriced growth story or a stock still carrying too much optimism.

Bull case: 45% undervalued

"The ones who understood what actually happened in 2024 and why the crash was a channel inventory problem, not a brand problem, had the best entry point in a decade..."

Read the full Bull Case to see why Celsius Holdings could be undervalued

Bear case: 18% overvalued

"Intensifying competition from well-established industry giants and new market entrants will likely force Celsius to increase marketing and promotional spending to maintain its shelf presence..."

Read the full Bear Case to see why Celsius Holdings could be overvalued

Do you think there's more to the story for Celsius Holdings? Head over to our Community to see what others are saying!

The Bottom Line

Celsius Holdings currently screens as overvalued on market multiples, with an especially wide gap between its P/E and a more tailored fair multiple. That kind of stretch leaves little room for disappointment if growth, margins or cash generation soften from here. For existing or prospective shareholders, the key question is whether Celsius Holdings can sustain strong profitability and justify this rich pricing, or whether the market eventually resets expectations and the multiple compresses.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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