One of the best ways to build wealth in stocks over the long term is to put your money to work in companies that are consistently reporting above-average growth.
Two stocks that have the makings of monster winners are Celsius Holdings (CELH +2.24%) and Deckers Outdoor (DECK +0.22%). These two stocks continue to reach new highs supported by growing demand for their products. Let's find out more about these opportunities.
1. Celsius Holdings
Energy drinks are growing increasingly popular. The market was estimated to be worth $159 billion in 2021, according to Statista, which explains why Celsius Holdings has gained significant traction with consumers in recent years.
NASDAQ: CELH
Key Data Points
Celsius' annual revenue has grown from $53 million in 2018 to $1.1 billion on a trailing 12-month basis. The stock has followed that growth, surging 4,840% over the last five years.
A large market for energy drinks explains only part of the reason to expect more gains from Celsius stock. Celsius is piggybacking on the distribution network of Pepsico to sell its beverages. Celsius will leverage this partnership further in 2024 by launching in Canada in the first quarter.
Celsius could ride the partnership with Pepsico to global brand status. Statista estimates that the energy drink market will grow 6.5% annually through 2027. What's notable is that Celsius is gaining market share, with the company's revenue increasing 104% year over year in the third quarter.
Investing in top brands while they are small can truly lead to life-changing returns. The surging demand for Celsius' products, international growth opportunity, and partnership with Pepsico translate to a fantastic growth stock to hold for the long haul.
2. Deckers Outdoor
Deckers Outdoor owns several footwear brands, including UGG, Hoka, Teva, and Sanuk, among others that generated $3.9 billion in sales over the last year. Strong earnings growth has sent this top shoe stock soaring over the last decade, and there are good reasons to expect more market-thumping returns in the years to come.
NYSE: DECK
Key Data Points
UGG and Hoka are the company's biggest sales drivers and are posting strong sales growth in a tough retail environment. UGG sales were up 28% in the last quarter, while Hoka has also been the star of the show for the company lately, with sales up 27% year over year in the September-ending quarter.
While UGG has been a popular fashion footwear brand for many years, investors will want to consider buying the stock for the future prospects of the Hoka brand. Hoka is giving Nike a run for its money in the athletic footwear category. Hoka was ranked the No. 1 men's athletic footwear brand among Gen X (44-59 years old), and No. 2 for women, in L.E.K. Consulting's 2023 U.S. Footwear and Apparel Brand Heat Index.
Sales numbers back up the report. Hoka has surpassed $1 billion in annual revenue, and management believes it can grow into a multi-billion-dollar brand over time.
Deckers operates a profitable portfolio of brands that delivered a return of 852% over the last 10 years, compared to 158% for the S&P 500 index. After another 71% advance over the last 12 months, the stock is still reasonably valued at a forward price-to-earnings ratio of 30 and remains a solid growth stock to hold for the long term.
