- Kirkland Signature, the private-label brand of Costco, released a new "Sparkling Energy Drink" product that seems to mimic Celsius.
- Stifel noted on Tuesday that the Kirkland launch was the likely factor for stock’s underperformance this week.
- However, while the firm believes there is some near term risk to Celsius from a stock perspective from the new launch, it does not expect to see a meaningful impact to sales going forward.
Shares of Celsius Holdings (CELH) fell 7% on Tuesday amidst heightened retail investor interest after Costco (COST) launched a copy for its sparkling energy drink.
According to Stocktwits data, retail chatter around CELH stock has risen 4200% over the past 24 hours and by about 244% over the past seven days.
Overall, retail sentiment around the stock jumped from ‘neutral’ to ‘extremely bullish’ territory over the past 24 hours, while message volume increased from ‘low’ to ‘extremely high’ levels.
A Stocktwits user criticised Costco’s new energy drink.
Another dismissed any chances of the Costco product taking down Celsius’s original energy drink, similar to how it failed to replace Grey Goose with its vodka.
Costco Launches ‘Rival’ Drink
Kirkland Signature, the private-label brand of Costco, released a new "Sparkling Energy Drink" product that seems to mimic Celsius with a similar can size, caffeine content and flavors earlier this week.
Stifel noted on Tuesday that the Kirkland launch was the likely factor for stock’s underperformance this week. However, while the firm believes there is some near term risk to Celsius from a stock perspective from the new launch, it does not expect to see a meaningful impact to sales going forward for Celsius or the category. The firm kept its ‘Buy’ rating on Celsius shares.
Stifel is not alone in its optimism for Celsius. According to data from Koyfin, 18 of the 22 analysts covering CELH stock rate it ‘Buy’ or higher while four rate it ‘Hold’. The average 12-month price target on the stock is $68.05, representing a potential upside of over 80% from current trading levels.
CELH stock has gained 6% over the past 12 months.
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