Tuesday, March 8, 2011

Spike Watch: Celsius Holdings, Volume Up Big, Price Up Bigger

Celsius Holding might have had its best trading day in over a year and a half on Monday, as shares closed the day fifty percent to the upside after an initial mid-day surge in price was followed up by a substantial finish into the close.

Price and volume usually pick up for CELH during the week or two prior to a quarterly earnings announcement, and it is expected that earnings for the fourth quarter are going to be announced soon.

Regardless of this stock's price action during 2010, CELH has already become a significant winner for 2011 by more than doubling in price in just short of three months time.  Anyone believing that the dip to mid twenty cent range made for a decent speculative buy, is sitting pretty right about now.

You can't argue with a double return - ever.

As I have stated recently, 2010 might have been a rough year for CELH, but 2011 is a whole new ballgame. 

Already a huge winner for the year, there might be more to come.

As always, however, keep in mind that it's always a good idea to take a few shares off the table during any significant runup.

The pre-earnings runups in 2010 were followed by sharp declines post earnings, so if the fourth quarter results don't come out looking good, then a decline would again follow.  That said, there's new products on the market and if the numbers come in even close to where the company projected they would during the fourth quarter of 2010, then CELH may become a huge rebound play in 2011.

There's a good chance the company will need to raise money again over the short term, however, and there's no guarantee that it will come from DeSantis again.

Keep an eye out for the earnings release.  The late day surge in price and the significant boost in volume is worth noting.

Disclosure:  Long CELH.

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