Celsius stock traded in a buy zone Tuesday after receiving an upgrade from Morgan Stanley. Shares of the energy drink maker made an actionable rebound earlier this week.
Morgan Stanley on Tuesday upgraded Celsius to overweight from equal weight, citing its accelerating growth, according to The Fly.
The Celsius brand has returned to sales growth following last year's market sharp slowdown, the firm wrote, and it expects further improvement with "much easier comparisons" from December through early June.
"We see another leg-up in CELH driven by a greater-than-expected reacceleration in topline growth with Alani's transition to PEP (PepsiCo) and improving Celsius growth," Morgan Stanley wrote.
Celsius and PepsiCo in August reached a deal where PepsiCo will distribute Celsius' Alani Nu drinks. Alani accounts for about 40% of sales, and should see some growth acceleration after moving to the PEP system, according to Morgan Stanley.
As part of the deal, Celsius acquired the Rockstar Energy brand from PepsiCo, while PepsiCo increased its ownership in Celsius to about 11%.
Celsius Stock Rises Early
Celsius stock climbed 1% Tuesday.
Shares are trading in a buy zone on a rebound from their 10-week line and 50-day moving average.
CELH stock surged 4.6% on Monday to break above a downward trendline.
Celsius has rallied nearly 118% so far this year.
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