Hi Everyone,
Prior to the earnings report, I sold my CELH position to enter a position in TMDX (sigh) and to move to the sidelines and see how the revenues are doing. Even though Celsius obtained prime shelf space, their sales are tanking 31% YOY. My best guess is that Red Bull dialed in on Celsius’ product positioning with sugar free and flavor options that effectively compete with Celsius. Also, Celsius has a very high level of caffeine, which could be easy to overdo. On top of that, Pepsi seems happy to sit on the sidelines. Perhaps, once the carnage is over, Pepsi steps in and picks up a new product line at a very low price. Who knows? What I do know, is that I would stay well clear of Celsius. I’m not a value/turn around story investor, so I won’t be following it. Perhaps other boards will pick it up, but I certainly don’t see anything to be enthusiastic about.
Best,
bulwnkl