Investing in stocks that consistently show robust growth is a proven strategy for building wealth over the long term. While many stocks can offer potential, two companies stand out as potential winners: Celsius Holdings and Deckers Outdoor. Let’s explore why these stocks have attracted attention and why they might be worth considering.
Celsius Holdings has rapidly gained popularity in recent years, thanks to the growing demand for energy drinks. With the energy drink market estimated to be worth $159 billion in 2021, Celsius has capitalized on this trend, experiencing impressive revenue growth. In fact, the company’s annual revenue has skyrocketed from $53 million in 2018 to a staggering $1.1 billion on a trailing 12-month basis.
Celsius has also formed a strategic partnership with beverage giant Pepsico, leveraging their distribution network to reach more consumers. This partnership, along with the projected 6.5% annual growth of the energy drink market through 2027, positions Celsius for further success. Notably, Celsius has been gaining market share, with its revenue increasing by a remarkable 104% year over year in the third quarter.
With its surging demand, international expansion plans, and partnership with Pepsico, Celsius has all the ingredients of a fantastic growth stock to invest in for the long haul.
Deckers Outdoor, the owner of popular footwear brands like UGG and Hoka, has consistently demonstrated strong earnings growth. Despite challenging retail conditions, UGG and Hoka have shown impressive sales growth, with UGG sales up 28% and Hoka sales up 27% year over year.
While UGG remains a fashion staple, the true growth potential lies in the Hoka brand. Hoka has emerged as a formidable contender in the athletic footwear category, even surpassing $1 billion in annual revenue. In fact, L.E.K. Consulting’s 2023 U.S. Footwear and Apparel Brand Heat Index ranked Hoka as the top men’s athletic footwear brand among Gen X and second among women.
With its portfolio of successful brands, Deckers Outdoor has delivered remarkable returns of 852% over the past 10 years. Even after a 71% increase over the last 12 months, the stock remains attractively valued with a forward price-to-earnings ratio of 30.
Investing in Celsius and Deckers Outdoor presents an opportunity to tap into explosive growth potential in the beverage and footwear markets. These stocks have proven track records and are poised to deliver substantial returns in the years ahead. Consider adding them to your investment portfolio for a chance to ride the wave of their success.
(Note: The author of this article may hold positions in the mentioned stocks. The Motley Fool has positions in and recommends Celsius and Nike.)
1. Why are Celsius Holdings and Deckers Outdoor considered potential winners?
Both Celsius Holdings and Deckers Outdoor have demonstrated strong growth and have positioned themselves strategically in their respective markets. Celsius has experienced significant revenue growth due to the increasing demand for energy drinks, while Deckers Outdoor’s brands, UGG and Hoka, have shown impressive sales growth.
2. What has contributed to Celsius Holdings’ success?
Celsius Holdings has benefited from the growing demand for energy drinks, estimated to be worth $159 billion in 2021. The company has also formed a strategic partnership with beverage giant Pepsico, allowing them to reach more consumers through their distribution network.
3. How has Deckers Outdoor performed despite challenging retail conditions?
Deckers Outdoor has demonstrated strong earnings growth, particularly through its footwear brands UGG and Hoka. UGG sales have increased by 28% year over year, while Hoka sales have increased by 27% year over year.
4. What is the growth potential of the Hoka brand?
Hoka has emerged as a strong competitor in the athletic footwear category and has surpassed $1 billion in annual revenue. It has been ranked as the top men’s athletic footwear brand among Gen X and second among women.
5. What are the returns on investment for Deckers Outdoor?
Deckers Outdoor has delivered remarkable returns of 852% over the past 10 years. Despite a 71% increase in the last 12 months, the stock remains attractively valued with a forward price-to-earnings ratio of 30.
1. Energy drink market: The market segment that includes beverages specifically formulated to provide physical and mental stimulation. Examples of popular energy drink brands are Red Bull and Monster.
2. Revenue growth: The increase in a company’s total sales over a specific period, often calculated on an annual basis.
3. Strategic partnership: A formal agreement between two companies to work together to achieve mutually beneficial goals and objectives.
4. Trailing 12-month basis: The financial data is calculated over the past 12 months as opposed to a single fiscal year.
5. Market share: The portion or percentage of total sales within a specific market that a company holds.
6. Forward price-to-earnings ratio: A financial ratio that compares a company’s stock price to its predicted future earnings per share.