/biz/ - Business & Finance

>>55240137
>>55240147
>>55240148
>>55240160

Okay so you know CELH

This is the Celsius Energy drink company.

Right

Okay cool.

So the stock is overvalued.

I did a first iteration of my CELH valuation a week ago.

DCF says the fair valuation of CELH's market cap aka the ostensibly true share price is 60.78. I gave them 20% Y/Y growth on their new numbers. I gave them 10% growth for their international numbers because they are pretty anemic so far. But let us reexamine a China case and see if they can capture that market. I don’t think that will move the FMV that much though (±10 dollars on share price maybe).

They entered an agreement with this company called Qifeng foods. When you enter business in China as a foreign company, you have to partner with a domestic business. They partnered with Qifeng. They gave them a $12M loan and a grant of shares to start selling their cans in mainland China. The loan term is for 5 years with interest payments in renminbi, and once it expires, they’ll collect a royalty on volume sold with a floor of $2.2M / yr payable to Celsius.

A lot of people are aware of CELH auditing controls .Months ago, CELH revealed their internal controls to ensure accurate financial statements are not reliable.

One “critical issue” that auditors identified was their Qifeng loan agreement. Basically, it was a special accounting snowflake because they extended the loan in dollars along with a grant of Comstock shares. The loan agreement is collateralized against the shares, and every year, a fraction of the shares granted have to be transferred back to Celsius. It was a problem because it’s tricky to mark-to-market those kinds of receivables - what do you do? There’s no such thing as bartering in markets. I'm running out of space to finish my thesis in one post but man it feels good to finally post on /smg/ again after being banned for a long time for inciting race war against whites