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SUMMARY
Jeremy Lefebvre discusses his investment approach, recent challenges facing Celsius Holdings, and the broader trends in the energy drink sector. He provides detailed analysis of portfolio management, competitive threats, and worst-case scenarios for several key holdings.
MAIN POINTS
- Jeremy outlines his three-part agenda: teaching his stock buying method, addressing a major issue with one of his stocks, and discussing downside risks for his latest investments.
- He emphasizes the importance of maintaining more income than expenses as the foundation for long-term investing success.
- Jeremy introduces negative news about Celsius Holdings, explaining recent Nielsen data showing a sharp drop in the Celsius brand's volume despite overall company growth.
- He attributes Celsius's volume decline to competition from Bloom Energy and discusses the differences between short-term fads and sustainable brands in the beverage industry.
- Jeremy compares Celsius's current challenges to historical periods of slow growth at Monster Beverage, highlighting the potential for recovery and long-term brand building.
- He predicts that a return to growth in Celsius brand volumes will trigger a significant rally in the stock, emphasizing the importance of monitoring monthly data trends.
- Jeremy details worst-case and realistic downside scenarios for several of his current and prospective holdings, including Celsius, RH, Wynn Resorts, Netflix, American Express, and SoFi.
- He concludes by encouraging viewers to review his recent stock picks and consider joining his private group if financially prepared.
DETAILED ANALYSIS
Jeremy Lefebvre begins by congratulating shareholders of Elf on the Shelf for strong recent gains, but quickly pivots to broader market concerns, notably the continued rise in long-term Treasury yields and mortgage rates. He notes that higher rates are beginning to impact corporate refinancing costs, which could eventually pressure earnings across the market. Jeremy then outlines his threefold agenda: sharing his disciplined approach to building stock positions, addressing a significant negative development with Celsius Holdings, and evaluating the downside risk for his latest generation of stock picks.
He stresses the importance of gradual accumulation when investing in stocks, typically spreading purchases over three to six months, and adjusting position size based on perceived risk. For example, he is comfortable making low-risk stocks like American Express or Netflix larger portions of his portfolio, while limiting exposure to higher-risk names like RH. This method, he argues, helps avoid the pitfalls of trying to time the bottom and supports long-term wealth accumulation.
Jeremy illustrates this with examples from his own portfolio, such as AMD and Palantir, where steady buying over time has yielded significant gains.
Central to his philosophy is the principle of maintaining more income than expenses. He recounts his own journey, starting with modest monthly investments while working at QuikTrip and gradually increasing his market exposure as his income grew. This surplus allowed him to take advantage of market corrections and crashes, buying quality stocks at depressed prices.
He cautions that without a positive income-expense gap, it is impossible to build a sustainable investment portfolio, regardless of market conditions or educational resources.
Turning to Celsius Holdings, Jeremy dissects recent Nielsen data showing a complex picture: while the overall company posted a 9.8% increase in volume and a 6.6% rise in average price, the core Celsius brand's volume dropped by 20%. This decline was offset by explosive growth in the Alani Nu brand, which saw a 74% volume increase despite a 4% price cut. Jeremy explains that Alani Nu remains a smaller part of the business, with Celsius still accounting for the majority of total volume.
He attributes the Celsius brand's weakness partly to the emergence of Bloom Energy, a new competitor that has rapidly gained shelf space in major retailers like Target. However, Jeremy expresses skepticism about Bloom's long-term prospects, suggesting it is more of a short-term fad than a sustainable brand, unlike Celsius or Alani Nu, which he believes are being built for longevity.
He draws parallels to other beverage industry stories, such as the meteoric rise and subsequent decline of Prime and TTCF, emphasizing that short-term sales growth does not guarantee long-term brand strength or profitability. Jeremy also references his experience with Monster Beverage, noting that the company experienced multi-year periods of slowing growth before rebounding to deliver massive long-term returns. He cautions against assuming that temporary slowdowns signal the end of a brand's growth potential, especially when management is focused on building enduring consumer loyalty.
Jeremy reviews recent performance across the energy drink sector, highlighting that while Celsius as a whole is still outgrowing established players like Red Bull and Monster, the latter's volumes are now shrinking, particularly when factoring in the underperformance of Bang. He maintains that the energy drink category remains robust, with overall segment volumes and prices rising. Looking ahead, Jeremy is confident that a return to growth in Celsius brand volumes will act as a catalyst for the stock, potentially leading to rapid gains as both investors and algorithmic trading systems respond to positive data trends.
Finally, Jeremy provides worst-case and realistic downside estimates for several stocks he is actively buying or considering. For Celsius, he sees $22 as the absolute floor, though he would welcome further declines as buying opportunities. RH, due to its cyclical exposure, could theoretically go to zero in a severe downturn, but he sees $102–$107 as a more likely bottom.
Wynn Resorts, despite recent weakness, is described as an attractive value given its portfolio of highly profitable properties in the US, Asia, and soon the Middle East, and its strong balance sheet. He also outlines downside scenarios for Netflix, American Express, and SoFi, generally viewing current prices as attractive relative to long-term prospects. Jeremy closes by encouraging viewers to review his recent stock recommendations and to join his private group only if their financial situation allows for serious long-term investing.
LINKS
- Application page for Jeremy Lefebvre's private stock and wealth group.
- Patreon page for supporting the channel and viewing weekly stock buys.
- Free workshops on investing topics provided by Jeremy Lefebvre.
- Jeremy Lefebvre's Instagram profile.
- Jeremy Lefebvre's X (Twitter) account.
- Jeremy Lefebvre's Facebook profile.
- Jeremy Lefebvre's personal website.
- 1000XStocks Instagram profile.
- 1000XStocks X (Twitter) account.