Celsius Earnings: Ongoing Investments and Distribution Expansion Propel Growth

We don’t plan any material changes to our $35 fair value estimate for no-moat Celsius after digesting its first-quarter results. As such, we suggest investors remain on the sidelines, with shares trading at more than double our intrinsic valuation. We are pleased with Celsius' continued progress in expanding total distribution points (up 55% year over year) through the wide-moat PepsiCo network, alongside investments in cooler placements, reformulations, and new product launches that have engaged consumers in the quarter and bolstered our near-term optimism. That said, Celsius' strategy remains replicable, and we expect that well-resourced competitors will continue to accelerate their innovation to enhance their health-oriented offerings, posing a challenge to the company's focus on this segment and international customer-conversion longer term.