1Semana·

Thesis has worked out

About a year ago @7Trader brought me to Celsius. Since I got in there has been a lot of chaos and I am now around breakeven. After I often wanted to sell, I always had the thesis that Pepsi would buy more of Celsius to sell Rockstar. What can I say, today part of the thesis is working out:

BOCA RATON, Fla. & PURCHASE, N.Y.--(BUSINESS WIRE)-- Celsius Holdings, Inc. (Nasdaq: CELH) ("Celsius Holdings") and PepsiCo, Inc. (Nasdaq: PEP) ("PepsiCo") today announced an agreement to strengthen their long-term strategic partnership. As part of the agreement: (i) Celsius Holdings' Alani Nu® brand will move into the PepsiCo distribution system in the U.S. and Canada, (ii) PepsiCo has acquired $585 million in newly issued convertible 5% preferred stock while extending its existing preferred stock to the same conversion period and (iii) Celsius Holdings has acquired the Rockstar Energy® brand in the U.S. and Canada from PepsiCo. PepsiCo will continue to own the Rockstar Energy brand internationally. Celsius Holdings will become the PepsiCo strategic energy lead in the U.S., managing the CELSIUS®, Alani Nu and Rockstar Energy brands, while PepsiCo will lead distribution for the Celsius Holdings portfolio in the U.S. and Canada.

$CELH

Holding on as long as the thesis stands is not easy, but it can pay off.

$PEP (-0,86%)

41 Comentários

felipe estupendo@felipeestupendo

1Semana

I hold Pepsi because Celsius was not tradable at SC. But I bought Pepsi at 126€ and thus easily caught the bottom. See how Pepsi benefits from Celsius. Besides my Pepsi dividend 😏

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PaulPK@PaulPK

Has made me 65.48% since the end of April :) I like!

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Marcelo@Marcelo-80

1Semana

Unfortunately I missed the entry at Celsius. Still struggling with myself whether I should get in now after the performance YTD

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ThemenmitKopf@topicswithhead

1Semana

@Marcelo-80 I'm only breaking even now, so I even bought at that price back then under different circumstances

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Marcelo@Marcelo-80

1Semana

@topicswithhead How many shares do you hold? Why haven't you bought more in the meantime?

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ThemenmitKopf@topicswithhead

1Semana

@Marcelo-80 can only buy on the NASDAQ, after a transfer and is too expensive for the volume. I have about 0.75 of the maximum position size I want. The rest is too expensive for me for 5+€ order costs. Of course, it's a stupid decision with ytd afterwards, but it was the right one. I also have pepsi in my portfolio, so it fits

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Marcelo@Marcelo-80

1Semana

@topicswithhead I have Pepsi too. Where do you trade Celsius? I'm with Smartbroker+ where a package of 25 shares costs around €15 in order fees

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Seventrader@7Trader

1Semana

I'm glad we're both on the same train 🤑🤞🏼
I already have 850 shares in my portfolio and am already up over 40%.
You have to hold these shares 🙃🤑

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ThemenmitKopf@topicswithhead

1Semana

@7Trader You bought after, unfortunately I didn't. For me, the additional costs for €500 purchase kits are quite high. That's a smaller percentage for you, but let's see where it goes.

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Seventrader@7Trader

@topicswithhead Yes, I understand. Better to buy less than not at all 😉🤞🏼

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Soprano@Soprano

So far, their success has proved you right, but I don't know where the journey is going to take them. Celsius has also delivered impressive figures recently, but you can also see that they are barely gaining a foothold internationally. I don't know if you know my energy drink analysis, but that's exactly what I expected. Celsius is a dominant brand in North America but doesn't really play a role internationally.

So it's not necessarily easy for Pepsi to give Celsius control of R* USA when they continue to have problems in Europe anyway, which won't get any smaller.

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ThemenmitKopf@topicswithhead

@Soprano but by unifying the brand, Celsius' portfolio will simply become broader and Pepsi's cleaner. As you know, I'm a firm believer in focused companies and this is no different. The brand won't be a blockbuster but it's better off with Celsius. International business is really disappointing, at the same time they are expanding really weird. I actually don't know how they started in the USA, so I can't say anything about it, except that it's going pretty badly. Pepsi itself earns okay on the deal, as they get convertible bonds and can channel more through the Pepsi network. Sooner or later, the International will also be given away. I still see the thesis that Pepsi will either change its beverage network or consolidate. That's why I remain relaxed. The dream would be to manage the food, expand a beverage network but only market the beverages. Hand over the beverages to Keurig peper completely and take over a large part of the shares in return. My brands all come from them and are only sold under pepsi. That means in the end you would actually only be a network for Peper, Celsius and co with a food/snack division.

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ThemenmitKopf@topicswithhead

@Soprano The only thing you can say about Celsius is that it naturally increases market share. Margins should also become more stable. Portfolio becomes broader. In addition, you can probably kill off many Rockstar products that Celsius already markets better.

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Soprano@Soprano

@topicswithhead I have to say that I'm surprised that you have both of them. I think Celsius is quite good. I like the products and see a strong brand there, at least in the USA and Canada. I think they have a good portfolio with Celsius for the fitness and lifestyle bubble, Alani Nu for women and wellness and Rockstar as a "budget brand" for gamers and students. I think this will help them secure market share and establish themselves in the long term.

To be honest, I don't think much of Pepsi. It's okay for dividend hunters, but otherwise there's not much to be gained. You say you like focused companies, but you're completely wrong here. Outside the USA, they mainly keep their heads above water by selling third-party brands. I don't know if that's what you mean by "beverage network"? In other words, the distribution, logistics, marketing and possibly bottling? Of course, this network also has weaknesses, as there are hardly any restaurants in Europe where Pepsi products are served.

A merger with Keurig Dr. Pepper would be a logical step towards further consolidation.

Or do you think they should go "fabless" like Coca Cola, where all these bottlers have been spun off into their own companies and Coca Cola itself only sells the syrups or licenses or whatever.

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ThemenmitKopf@topicswithhead

@Soprano I have Pepsi because of the price. I have too much cash left and think the share is fairly valued in the consumer sector. It's quite expensive in itself, but what can you do? I'm only holding it for a maximum of 3 years. The Coca Cola model would of course be great, but I think that's difficult to achieve now. I would rather focus on the governance structure. Food remains completely with Pepsi and is diversified across several areas (too many chips brands, the question remains why they have so many at all) and beverage network. Means everything around getting your beverage into the market. To do this, give away all or half of your own brands but still manage them. Just like Lipton and actually everything except Pepsi Cola. But you also have to make a clear commitment to it. Of course, this means selling the name brand to Dr. Pepper. Indirectly, of course, this also means more or less turning away from the US beverage market, unless the partners want aid. So to speak, you do food and international marketing and distribution. I think that would be better. They have been losing to Coca Cola for years and doing nothing, see Rockstar. Pepsi simply needs clear structures and visions so that it knows fairly what it should do.

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ThemenmitKopf@topicswithhead

@topicswithhead At the same time, you would then become a shareholder in Keurig and act on the board. They have also had problems for years. So it's a win-win for both. For whatever reason, they don't know how to run a company. I know it's easy to say, but they're all on such a mission, it's really unbelievable. It's no wonder why you lose against Coca Cola brands. They are clearly acting according to plan with established brands and a good model. Instead of bringing Energy in-house, they left it with Monster and just took over distribution.

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ThemenmitKopf@topicswithhead

@topicswithhead In short, take over Keurig (due to the brands) or 25% stake, sell Pepsi, clean up North America and business and take over international business. Then clean up Keurig's portfolio, clean up Pepsi's portfolio and you're done. Then you have Keurig for USA+ Can, Pepsi with food and beverage marketing and Celsius for Energy

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Soprano@Soprano

@topicswithhead Your restructuring plan makes sense. You could get in for 10 billion as an activist investor :D But roughly speaking, that would be the right step, but they won't take it on their own. They just have the problem that they are good at doing everything themselves in the USA and are bad everywhere else and don't want to admit that they have to die one of two deaths: Either just the USA and do everything themselves - or internationally and hand over competencies.

But I don't really know what they wanted with the snack division. Of course they just wanted to diversify, but they're not doing anything with it, they're not innovative and it's questionable how long they'll be able to do anything with their ancient product range. So for a long time, instead of being innovative and reacting to trends, Pepsi's business model was simply to buy EVERYTHING that was available from the cola business. But that no longer works.

The best example is that they absolutely had to take over Punica. It was an absolute cult brand in the 90s and is now completely dead thanks to Pepsi. Nobody buys Punica anymore and for two years it was no longer produced at all. I think 90% of the Pepsi takeovers were garbage and they just bought senseless sales.

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ThemenmitKopf@topicswithhead

@Soprano It may not work out, but the new management is okay. I think it's just a transitional investment at the moment. Rockstar is finally out for me at the start. Since Celsius is not available internationally, that is also well done. Let's see what happens next.

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Soprano@Soprano

@topicswithhead Of course Celsius is already international - but with limited success. Or what do you mean? That's what we were talking about in the first place.

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ThemenmitKopf@topicswithhead

@Soprano I meant in terms of the countries. They are in 6-7 countries outside North America and then often not in retail

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