Why CELH Could Keep Growing and When to Jump In

$Celsius Holdings, Inc.(CELH)$ Whenever a stock is at $100, the time to buy it is below $90. Whenever the same stock is at $31, the right time to buy it is in the mid $20s.

The correct formula for fair valuation doesn’t use sales, earnings, book, or PEG. Fair valuation is actually (current price * 0.85 = attractive entry price). Ironically, in reality we usually buy stocks when they go up +20% rather than down -20%.

Who knows if CELH will be a good stock going forward. Financially it looks like it will be a successful company: rapid historic growth, high margins, nice incremental margins, and market share gains both in units and dollars.

The stock is essentially priced for low sustained growth (high 25-30x pe) for an ultra high margin/ROE consumer staple.

If CELH can grow sales 10%+ over time they’ll likely be a great stock. People are extremely fixated on short-term results and particularly sell-in vs sell-through with PEP.

Personally I think CELH has a lot more growth. They seem to have close to full shelf space in gas stations and club stores. But they seem to lack in grocery stores. They likely can increase their sales per user as they become a habitual vs exploratory purchase. MNST $Monster Beverage(MNST)$ and Red Bull delivered most of their dollar value sales growth many years after initial popularity.

I’ve liked CELH from $30>100>$30, so I’m extremely biased/emotionally compromised. Nonetheless, I don’t see how they stop growing long term, and if they grow, the stock should go up over time.