J.P. Morgan analyst Andrea Teixeira highlighted a significant acceleration in U.S. energy drink sales, which jumped 18% in May from 14% in April, in a note on Wednesday. This marks the third consecutive month of improving 13-week rolling trends and the strongest growth rate since November 2023.
The acceleration stemmed from gains in both buy rate, which rose 88 basis points to 10% year-over-year, and household penetration, which climbed 113 basis points to 3.25% year-over-year.
Celsius Holdings (NASDAQ:CELH): Teixeira said the data also bode well for Celsius Holdings, as brand Celsius showed sequential improvement in household penetration and buy rate, suggesting better purchase frequency despite ongoing pressure.
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Momentum remains strong for Alani Nu too, although growth across key performance indicators slowed slightly, with recent NielsenIQ data reinforcing signs of a positive inflection in brand Celsius.
The analyst reiterated an Overweight rating on Celsius Holdings.
Teixeira highlighted a slight uptick in household penetration for Celsius Holdings, rising 9 basis points to remain flat year-over-year, while Alani Nu held steady with a marginal 2-basis-point gain, maintaining a strong 391 bps increase versus last year.
Monster Beverage Corp. (NASDAQ:MNST): Teixeira noted that while the overall data remain solid for Monster Beverage, the outlook is more mixed as gains in household penetration are being partially offset by a slowdown in buy rate, reflecting reduced purchase frequency.
Teixeira noted that Monster Beverage saw a 168-basis-point slowdown in purchase frequency, bringing it to -1% year-over-year. The analyst maintains a Neutral rating on Monster Beverage.
Keurig Dr Pepper Inc. (NASDAQ:KDP): Teixeira observed a mixed setup for Keurig, with gains in GHOST offset by C4’s KPI slowdown, though both brands still show strength in NielsenIQ data.
The analyst maintains an Overweight rating on Keurig Dr Pepper (KDP).
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