6/12/24 - vrockstar - 
CELH - this one seems to be topical bc of the potential energy drink ban in UK that could be determined by political wins in a month. while i don't think the stock should/will only move on this news, it's notable and also concerning that this is being sold on a day like today where risk is up. my sense is there's a rotation to cheaper more beaten up names in the staples universe. look at 
LULU for instance. found a floor, "passed" earnings test. still not cheap (arguably better risk/reward here than CELH, but for a diff day to explain), but also being dumped. that's the blue chip clothing co.
so what do you pay for CELH growing 30% PA with no obvious end in sight, a nice tasting product i must say (even as a non-energy drink drinker lol i like black coffee, i had to try it to see the hype!)...
1. trades like a tech co with worse gross margins (50-60%) vs. tech at 70-80% (software that is). that's fine - maybe these come up over time, but it's not tech
2. not such a big deal to point out the mr. obvious comment above except for that it trades w/ software-like ev/ sales multiples at 8x. again. not cheap.
3. what about cash? well dilution is less an issue here unlike software (that's great!) and if we can give credit for even 300-350 mm in FCF (perhaps it's higher, but let's be conservative) that's 2.5+% yield which while sub-5% "risk free" rate... is again growing 30% pa and probably cheap.
conclusion: this stock is a buy. if you were to theoretically buy it today, you probably make money into YE and in '25. but the chart remains sketch, you have this regulatory overhang, risk STILL remains stretched (GENERALLY! even if we got a favorable CPI print). so even tho i'm still 60% positions 40% cash... i'm treading lightly across the board. and so i'll either buy this in the mid 50s (ideally low 50s) or if it just course corrects from here and goes higher... i'll miss it and find another spot to engage, even if it's at a higher level.
rule #1 is don't lose money. so i don't see the greatest setup here and won't buy the dip.
but i am long-biased. gl to the holders.
V
CELH - this one seems to be topical bc of the potential energy drink ban in UK that could be determined by political wins in a month. while i don't think the stock should/will only move on this news, it's notable and also concerning that this is being sold on a day like today where risk is up. my sense is there's a rotation to cheaper more beaten up names in the staples universe. look at LULU for instance. found a floor, "passed" earnings test. still not cheap (arguably better risk/reward here than CELH, but for a diff day to explain), but also being dumped. that's the blue chip clothing co. so what do you pay for CELH growing 30% PA with no obvious end in sight, a nice tasting product i must say (even as a non-energy drink drinker lol i like black coffee, i had to try it to see the hype!)...
1. trades like a tech co with worse gross margins (50-60%) vs. tech at 70-80% (software that is). that's fine - maybe these come up over time, but it's not tech
2. not such a big deal to point out the mr. obvious comment above except for that it trades w/ software-like ev/ sales multiples at 8x. again. not cheap.
3. what about cash? well dilution is less an issue here unlike software (that's great!) and if we can give credit for even 300-350 mm in FCF (perhaps it's higher, but let's be conservative) that's 2.5+% yield which while sub-5% "risk free" rate... is again growing 30% pa and probably cheap.
conclusion: this stock is a buy. if you were to theoretically buy it today, you probably make money into YE and in '25. but the chart remains sketch, you have this regulatory overhang, risk STILL remains stretched (GENERALLY! even if we got a favorable CPI print). so even tho i'm still 60% positions 40% cash... i'm treading lightly across the board. and so i'll either buy this in the mid 50s (ideally low 50s) or if it just course corrects from here and goes higher... i'll miss it and find another spot to engage, even if it's at a higher level.
rule #1 is don't lose money. so i don't see the greatest setup here and won't buy the dip.
but i am long-biased. gl to the holders.
V
Note
$53 now at the open 6/26... interesting. small bite of this apple. any thoughts fam? i'm nervous this px action reminds me of what we saw in LULU before the big announcement they lost product officer and had to put out a press release. is there something related coming here (that will give us a better dip buy?) i'm okay owning the asset here in small sizeNote
so we're now sub $45when the market is fearful and nuking you BUY QUALITY
ideally you find the best industry (cough cough, mag7 + semis)... but generally there are GREAT horses in every tide.
CELH remains the fastest grower that while expensive is unique/ niche and will find bids when we go higher. will it be today idk.But i'm at a 2.5% position in this bad boy. ENERGIZE this old man.
gl fam
V
zander3650 you in?
Note
adding here.great results.
gross margin expanding.
everything can always go lower. but let's be clear, you're closer to floor than peak even in a YE context IMO. they sell a better version of legal drugs than coffee/ sbux.
like the sub $42 entry here, won't be necking in hard, but i've sized it up as they've passed go and we've yet to collect our proverbial $200 bucks
V
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.