Celsius Holdings Faces Legal Challenge As Shareholder Class Action Is Filed Against The Company
On December 3, 2024, Pomerantz LLP announced the initiation of a class action lawsuit against Celsius Holdings, Inc. (NASDAQ: CELH), bringing significant attention to the company as it faces allegations of engaging in securities fraud and other unlawful business practices. This lawsuit is notable as it comes at a time when the company has been dealing with declining stock prices and disappointing sales reports, which have raised concerns among investors.
The class action specifically targets Celsius and various members of its executive team, suggesting that these individuals may have failed to disclose important information relevant to the company’s financial health. Investors who purchased Celsius securities during the specified class period are advised to reach out to Pomerantz LLP for further details on how to participate.
Shareholders have until January 21, 2025, to express their interest in being appointed as Lead Plaintiff in this case. Interested parties are encouraged to provide necessary details, including their contact information and the number of shares acquired, via email or phone.
The troubles for Celsius began to unravel publicly in May 2024, when the company saw a stock price drop of nearly 13% following disappointing retail sales trends reported by Nielsen. Analysts at Morgan Stanley indicated that Celsius's sales growth had decelerated, falling to 39% year-over-year for the week ending May 18, a sharp decline from a 50% growth rate just weeks before. This decline was mirrored with a decrease in market share and a detrimental 7.2% fall in product pricing compared to the previous year. Investors were warned of further challenges as the company faced tough comparisons in sales as it moved past its Distribution Agreement with Pepsi.
The situation worsened on September 4, 2024, when Celsius disclosed a significant reduction in orders from Pepsi, reporting that their sales to the beverage giant had dropped from an expected $100 million to $120 million. As a result, on that same day, Celsius's stock took a dive, closing at $32.39 after falling $4.25 per share, or 11.59%.
Adding to the troubling financial disclosures, Celsius reported on November 6, 2024 that their overall revenue for the third quarter was approximately $265.7 million, which is a steep 31% decline from the $384.8 million recorded in the same quarter the previous year. Their North American revenue also fell dramatically at 33%, highlighting ongoing struggles. More starkly, revenue from Pepsi had plummeted by nearly $123.9 million, exacerbating the company's financial woes.
As Celsius continued to grapple with these setbacks, the firm also reported a significant decrease in gross profit, which dropped by $71.9 million, showcasing a 37% reduction attributed to increased promotional allowances and corporate incentives that weighed heavily on their bottom line. These financial reports culminated in a stock price reduction of 5.32% on November 6, bringing shares down to $30.04.
Founded over 85 years ago, Pomerantz LLP has established its reputation as one of the leading law firms advocating for shareholders’ rights in cases of securities fraud, securing billions in damage awards throughout its history. The firm’s experience in handling corporate misconduct provides credence to the seriousness of the allegations against Celsius Holdings.
As developments continue to unfold, investors are encouraged to stay informed about the ongoing legal proceedings and their potential implications for the future of Celsius Holdings. For more information regarding the class action, interested shareholders can learn about their rights and how to engage by visiting Pomerantz's website or contacting Danielle Peyton directly at 646-581-9980 or via email.
The class action specifically targets Celsius and various members of its executive team, suggesting that these individuals may have failed to disclose important information relevant to the company’s financial health. Investors who purchased Celsius securities during the specified class period are advised to reach out to Pomerantz LLP for further details on how to participate.
Shareholders have until January 21, 2025, to express their interest in being appointed as Lead Plaintiff in this case. Interested parties are encouraged to provide necessary details, including their contact information and the number of shares acquired, via email or phone.
The troubles for Celsius began to unravel publicly in May 2024, when the company saw a stock price drop of nearly 13% following disappointing retail sales trends reported by Nielsen. Analysts at Morgan Stanley indicated that Celsius's sales growth had decelerated, falling to 39% year-over-year for the week ending May 18, a sharp decline from a 50% growth rate just weeks before. This decline was mirrored with a decrease in market share and a detrimental 7.2% fall in product pricing compared to the previous year. Investors were warned of further challenges as the company faced tough comparisons in sales as it moved past its Distribution Agreement with Pepsi.
The situation worsened on September 4, 2024, when Celsius disclosed a significant reduction in orders from Pepsi, reporting that their sales to the beverage giant had dropped from an expected $100 million to $120 million. As a result, on that same day, Celsius's stock took a dive, closing at $32.39 after falling $4.25 per share, or 11.59%.
Adding to the troubling financial disclosures, Celsius reported on November 6, 2024 that their overall revenue for the third quarter was approximately $265.7 million, which is a steep 31% decline from the $384.8 million recorded in the same quarter the previous year. Their North American revenue also fell dramatically at 33%, highlighting ongoing struggles. More starkly, revenue from Pepsi had plummeted by nearly $123.9 million, exacerbating the company's financial woes.
As Celsius continued to grapple with these setbacks, the firm also reported a significant decrease in gross profit, which dropped by $71.9 million, showcasing a 37% reduction attributed to increased promotional allowances and corporate incentives that weighed heavily on their bottom line. These financial reports culminated in a stock price reduction of 5.32% on November 6, bringing shares down to $30.04.
Founded over 85 years ago, Pomerantz LLP has established its reputation as one of the leading law firms advocating for shareholders’ rights in cases of securities fraud, securing billions in damage awards throughout its history. The firm’s experience in handling corporate misconduct provides credence to the seriousness of the allegations against Celsius Holdings.
As developments continue to unfold, investors are encouraged to stay informed about the ongoing legal proceedings and their potential implications for the future of Celsius Holdings. For more information regarding the class action, interested shareholders can learn about their rights and how to engage by visiting Pomerantz's website or contacting Danielle Peyton directly at 646-581-9980 or via email.
Topics Financial Services & Investing）
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