Texas AG Probe Sparks Celsius’s Biggest Three-Month Slump; Analysts Maintain $55 Targets
CELH•Texas AG Ken Paxton launched an investigation into Celsius and Alani Nu over alleged marketing claims, prompting the stock’s largest drop in three months. Bank of America retained its Buy rating with a $55 price target (98% upside) and Morgan Stanley upgraded to Overweight with a $55 target.
1. Texas AG Investigation
Texas Attorney General Ken Paxton opened a probe into Celsius and Alani Nu to assess whether the companies misled consumers about the safety and marketing of their energy drink products.
2. Share Price Impact
The announcement prompted Celsius shares to suffer their largest single-day decline in three months, reflecting investor concerns over potential legal liabilities and reputational damage.
3. Analyst Ratings and Price Targets
Bank of America reaffirmed its Buy rating on the stock with a $55 price target, implying 98% upside, while Morgan Stanley upgraded Celsius to Overweight with the same $55 target, citing valuation near 52-week lows.
4. Sales Trends and Industry Perspective
Analysts noted robust growth in the Alani Nu brand—sales jumped over 50% in a recent two-week period—while broader energy drink volumes expanded; another analyst expects limited long-term impact given the industry’s history of navigating similar regulatory scrutiny.
