Top 3 Beverage Stocks Pouring Out Profits

PepsiCo's (NASDAQ: PEP) nearly-$2-billion purchase of prebiotic soda maker Poppi is a reminder of the value consumers place on their beverages of choice. While Poppi has built its brand as a gut health-friendly drink, even more traditional sodas and energy drinks may be having a moment.

The S&P 500 may be down nearly 2% year-to-date (YTD) as of Mar. 25, but three major beverage companies—Celsius Holdings Inc. (NASDAQ: CELH), Monster Beverage Corp. (NASDAQ: MNST), and Keurig Dr Pepper Inc. (NASDAQ: KDP)—are all up during the same period, some by double digits.

Consumer staples names have gotten a boost this year as customers have stocked up on everyday items in the face of declining consumer sentiment and concerns about tariffs and the potential for further increases in cost. These three companies have all outpaced the benchmark iShares U.S. Consumer Staples ETF (NYSEARCA: IYK) since the start of 2025, standing out in an already popular sector.

Strong Earnings and Major Acquisition Fuel Celsius Optimism

Rising interest in health-conscious drink options is likely to benefit Celsius, makers of the sugar-free energy drink of the same name. In February, the company's better-than-anticipated earnings for the final quarter of 2024 helped to boost the price of CELH shares more than 20% in a single day.

The stock has also been rising in the back half of March as the company announced an expansion into Belgium and Luxembourg. International sales are some of Celsius' fastest-growing, having climbed by 39% year-over-year (YOY) in the fourth quarter of 2024. Celsius' adjusted diluted earnings per share of 14 cents for the last quarter topped analyst predictions by 3 cents as well.

Celsius already has substantial brand recognition in the better-for-you drink space, but the company's recent acquisition of nutritional supplement energy drink firm Alani Nutrition, better known as Alani Nu, is likely to continue its dominance in this industry.

For a net purchase price of $1.65 billion, Celsius expands its offerings to include a female-focused brand that is highly popular among Gen Z consumers. Celsius expects that, with Alani Nu, it will generate roughly $2 billion in annual energy product sales.

Multiple analysts boosted their price target for Celsius upon the announcement of this major acquisition, and the company now has a consensus price target of $45, more than 30% above price levels, on Mar. 25, 2025.

Monster Makes a Push in the Affordable Energy Drink Space

Monster is one of Celsius' main competitors, and while it has not yet reported a significant acquisition in 2025 it does have some key advantages over its rival for investors interested in comparing stocks.

Monster's share of the energy drink market is strong at roughly 35%. Despite its sizable presence in the space, Monster has still maintained revenue growth; net sales for the latest quarter climbed almost 5% YOY to $1.8 billion.

Monster may be claiming a larger portion of the niche budget energy drink space. In the final quarter of 2024, its Strategic Brands segment—which includes a portfolio of products purchased from The Coca-Cola Co. (NYSE: KO) and Monster's affordable energy brands Predator and Fury—grew sales by more than 11% year over year, though this segment remains much smaller than the company's primary energy drinks business.

Although the company's operating expenses are rising, which may give some investors pause, Monster remains fairly popular among analysts. Ten out of 19 analysts rate it a Buy.

Refreshment Beverage Performance Drives Analyst Enthusiasm for KDP

Keurig Dr Pepper noted relatively strong YOY sales growth for its refreshment beverages and international categories—5.8% and 6.8%, respectively—in 2024, despite a slump in coffee sales. Refreshment beverages had a particularly strong fourth quarter as well, with sales climbing by nearly 11% YOY.

On an adjusted basis, total quarterly sales improved 6.2%, a sign that this major player in the beverage space also has found room for growth.

Investors might be startled by the company's poor bottom-line performance in the last quarter, but much of this is due to goodwill impairments and distribution termination payments.

Keurig Dr Pepper has seen renewed analyst interest following its latest quarterly report. Analysts at Barclays, Morgan Stanley, J.P. Morgan, and other firms all established new ratings or increased their price targets for KDP shares.

Overall, analysts now expect upside potential of more than 13% for KDP stock.

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