“What’s in a name? That which we call a rose by any other name would smell just as sweet.”
What Happened
Shares of Celsius Holdings Inc. were down double digits Monday as the price of Bitcoin and other cryptocurrencies fell related to the pausing of withdrawals and transfers between accounts by cryptocurrency lending firm Celsius.The problem is of course that Celsius Holdings doesn’t offer Bitcoin trading or anything to do with cryptocurrency. Instead, the company sells calorie-burning beverages and was likely the victim of mistaken identity by investors.
Crypto lending firm Celsius said it was taking steps necessary to protect users.
“We are announcing that Celsius is pausing all withdrawals, swap, and transfers between accounts. We are taking this action today to put Celsius in a better position to honor, over time, its withdrawal obligations,” crypto company Celsius said.
Beverage company Celsius released no news or earnings on Monday. Shares fell double-digits Monday as peer companies Monster Beverage Corp, Coca-Cola Co., and PepsiCo Inc. all saw small moves and nothing drastic happened in the beverage sector.
The last news from Celsius was the company’s first quarter, which saw revenue growth of 167 percent to $133.4 million. An increase of 395 percent year-over-year in the direct store delivery network was among the contributing factors to the strong quarterly growth. Celsius products are available in more than 140,000 stores in the United States.
Why It’s Important
Confusing company names with another can often result in large movements as investors try to get a piece of a company moving on news.Penny stock Luminar Media Group Inc. higher in confusion to lidar company Luminar Technologies Inc after the latter completed its SPAC merger and began trading under its new name in late 2020.
Shares of Auris Medical Holding and Oculus VisionTech Inc. also traded higher in two separate occasions when private companies with similar names were announced as acquisitions by Johnson & Johnson and Meta Platforms Inc., respectively.
