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the elevator down that is what Nike stock Chipotle Celsius and Lululemon are taking at this point in time Chipotle stock fell over 5 percentage points here today that one is showing a lot of topping signal less than two months ago Celsius beverage was about 42% higher than where it is right now that stock has dropped over 42% just in less than two months at this point in time Nike stock down another three percentage points here today that one is now down over 32% so far this year Lulu Lemon that's the bonus stock today it's down over 42% so far just this year alone so in this video since these stocks are taking the elevator down we're going to speak about how low could these stocks go usually a lot of times we're focused on the upside in regards to stocks so we're going to speak about Nike Chipotle Celsius and Lululemon in this video what's the worst case scenario I see for these stocks like how low are they going to go could they fall another 20% 30% 50% 60% from where these stocks are at right now and then we're going to go through what I believe is the worst case scenario for these stocks so we'll go through like dire dire situation and then we'll go through kind of what I think is a realistic situation on how low how much lower these stocks will go from here okay hope you guys enjoy this video as always appreciate everybody joining me 732 th000 plus subscribers new alltime high I thank everybody that's that's watching this video if you enjoy all my videos where I'm talking about upside downside with stocks what's going on in the market make sure you're subscribed here whether you're watching us on your phone your iPad your tablet your computer wherever you're watch this make sure that subscribe button is hit Okay so we're going to start out here we'll start with Nikey this is a stock I've personally been buying a lot of shares of recently and I'm getting absolutely wrecked on it down 275% on this stock down $122,000 so this one is hitting me and you know just nailing me right now okay so in regards to Nike where I want to start here is the valuation so forward p on the stocks about 21 right now obviously when you think about forward PE it's future projections right of where earnings per share is going to go so it's not even it's never a guarantee but 21 this is a weird situation for Nike because where you look at many stocks in the market they're kind of valued around here but the issue is Nike has a freak situation going on right now where their revenues are actually expected to go down over the next few quarters down as in negative now if you look at an average stock in the market their revenues are not going negative but it's Nike on the other side and so you got this incredible company incredible brand one of the most successful companies in the world so you would assume after this next few quarters they're going to get it turned around and then they'll be an outperformer again but how do you value a stock like that when they're in this type of predicament where you know literally their revenues are expected to go down here in the short term now if we look at the Rona lows for Nike was around $60 a share that was back March 23rd 2020 in the depths of the Rona crash very important area to understand where Nike went down to in that situation cuz it's about 73 bucks here today it's the lowest it's been really since that Rona crash now at this point in time and it just seems like it goes lower and lower and lower so it's important to understand we could go all the way down to $60 in this baby and we'd be right back down to the Rona crash levels on the stock next up here this is what we're looking at here is 5year PE ratio okay and if we look at the PE ratio of Nike over the past 5 years guess what this is a lowest it's been in the past 5 years when it comes to Nike the p ratio on this one's about 19 uh as of right now in tring 12 month basis rate which literally is the lowest it's been today like literally today the day I'm recording this video the median is 34 over the past 5 years for p ratio so we're massively massively under where the stock usually trades at a PE wise but you got to understand it kind of makes sense in a way because hey the companies going through tough times right now revenues are expected to go negative here in the short term and so being that that's a situation you can understand the p ratio being considerably lower than where it traditionally has been at right now next up what I want to show you here is looking at earnings per share it's expected to be down 43% in this quarter they're about to report now do keep in mind they got a lot of cost cutting measures going around so if there's one area they might be able to beat at in this upcoming quarter it might actually be earnings per share but the revenues expect to go down about 10% in this upcoming quarter and Nike basically said it's going to be down about 10% in their latest earnings so Nike already had kind of a scare the market event this latest earnings in terms of the guidance was so bad that it really freaked the market out in a substantial way and so if you're thinking about kind of on a bullish angle that's something to be somewhat bullish about then Nike at least got that out of the way right now check this out this is a problem with Nike is why what if you know they're expecting Revenue to be down about 10% in this quarter they're about to report what if that 10% down continues for the next few quarters after that analysts are expecting only 65% down that following quarter then 2.6% down but what if the consumer doesn't get better what if Nike's business doesn't turn around in the short term and what if they report another down percent number the following quarter right and they're like you know what we think we're going to kind of be in line with where we at as far as Revenue shrink for the rest of the year that would be an ultimate panic situation in regards to Nike stock if you think people have freaked out so far in regards to Nike that's a whole new level of panic that would ensue if that were to happen right I don't expect it to happen but if it did just telling you there'd be a whole other level of panic so here's the worst case scenario for Nike stock in 2024 worst case scenario is $50 to $55 which today this talks about 73 so that would be a lot of downside but that's that's if we get this ultimate panic situation everybody freaks out right on on a massive Revenue shrink of 10% for the entire year right the realistic be case for this year in my opinion for Nike is around $60 $65 we get one last flush in the stock maybe over this next 3 months we kind of get in that 6065 range and then that's about it okay so that's kind of what I for see there now that being said I'm going to likely buy Nike stock every week for the next 6 to 9 months like it doesn't matter if the Stock's 60 50 70 80 it's all a steel deal for a long-term investor like myself so I'll be buying the stock you know pretty much week in and week out and one last thing I want to cover in regards to Nike specific is Brands like on and hoko we haven't really seen those Brands get hit yet right and so it's kind of giving a false illusion that like Nike is in trouble but these other brands aren't not not really okay you got to understand who's the buyer of Hoka and on products right you know I saw was at dick sport Goods recently and uh I saw a lady you know mid-40s buying a couple pairs of Hoka shoes right you know that that's who is really buying this it's little upper middle class 40 50 year olds right um maybe some in their 30s that's hok and On's customer base so those ones haven't been as bad hit by inflation because those are smaller Brands so they're more of a niche market somebody like a Nike they K everybody's Nike customers rich people buy Nike products right people that are you know you know let's call it not in the best fin financial situation buy Nike products the middle class buys Nike products everybody buys Nikes they're like a Starbucks of apparel right hoking on they're much more Niche and they cater much more to the middle class right and so that's why you haven't really seen those ones hit as bad because we haven't really seen job losses in that P that that specific group in any substantial way yet doesn't mean it can't come over the next 6 12 months but yet we haven't seen that yet right in additionally on top of that inflation doesn't hit the upper middle class nearly as much as the middle class and Below those little Folks at really get hit hard and that leads us to Lululemon now Lululemon's been a company that for the longest time they catered to the upper middle class right that you know prior to Rona that was honestly who Lululemon's customer base was it was the upper middle class women right and nowadays it's very different Lululemon they're they now cater to honestly all customers of pretty much all income levels but specifically the middle class now is L lemon's customer base as well and the reason they had to do that is you only have so many in the upper middle class that will buy your product if you want to become a giant Corporation and you want to push to A10 billion run rate on revenue or above you better make sure everybody's your customer based or at least a middle class and that's what Lululemon had to do the upper middle class got Lululemon to like a34 billion run rate but you want to get it up to 10 or so like they did this past year you got to attract more than just upper middle class folks you better start attracting the middle class right well that's great great at first but then if the middle class gets slice and dice by inflation and eventually they run out of of money to spend then your numbers are going to start looking really bad really quickly right and in regards to L lemon the stock just continues to fall it's now under it's now under $300 a share right and it's not that far away from that 2022 crash price when the market was just getting leveled right back then it kind of reached $260 $270 a share it's like you get one bad week with lemon stock next thing you know you're going to be in 270s or so right right around that 2022 crash now keep in mind if we go back to the Rona crash it was just under $150 a share so if we went all the way back there that's about a 50% retracement from where we're at right now okay so just a little foood for thought in regards to that right now for lemon they got two problems here right off the bat okay one is analysts are expecting Revenue growth to accelerate over the next few quarters when it comes to revenue and when it comes to earnings per share okay now if that happens great but the issue is there's a Viewpoint that actually the consumer might be getting weaker as this year takes on and if if that's true if that's accurate oh boy watch out okay because then Lululemon is not going to show accelerating Revenue growth and earnings per share growth what they'll actually show is shrinking earnings per share and shrinking Revenue growth right and so that's a whole other dilemma that could potentially happen and keep in mind Lou lemon's revenues haven't been negative and look I don't even remember the last time Lou lemon's revenues were negative imagine if Lou Lemon came with a print and somehow their revenues went down in a quarter that would be pure panic in regards to Lemon now lemon also has an issue here if you look at Google Trends honestly this is looking at the United States Google trends for Lululemon right it's stuck for the past two plus years now at this point in time so clearly interest in Lululemon's products as kind of peaked at least in the short term it doesn't mean 5 years from now or 10 years from now it's not going to be much higher than today but for at least the moment for and when I say the moment the last two plus years it's completely stock right and I do think part of that just to be honest is the consumer getting hit so hard with inflation over the last couple years so they're not as interested to spend hundred plus dollars on on um yoga pants when you can get them from a lot of other places for a lot cheaper right worldwide if we look at lemon we've seen a little pickup over the past two plus years but not really the pickup you want to see lemon's expanding more and more worldwide but I mean just you know you would want to see a lot stronger pickup than that just to be honest with L lemon going more worldwide now that leads us to our next thing with in regards to Lam and I think of these stocks we're talking about here this is you know one or two of the stocks that are in the most precarious situation because of Lululemon's brand right and lululemons done well building out their business to about A10 billion run rate right and they did that on the back of not really necessarily standing for anything or really being known for anything other than just you know having really good leggings right if you think about Nike's brand Nike's brand is like I'm a top tier athlete right that's what they've always wrapped their brand in since like the 1980s right they're going to buy out the best athletes in the world they're going to buy out the best sporting events and Nike's branding is going to be everywhere so that's what like Nike stands for Lululemon I Lululemon kind of stands from a white blonde in La I drive a used Range Rover and my hubby makes uh you know $325,000 a year like that's Lululemon's brand right there okay I mean it's just got to be honest with you guys and so how does that brand handle a situation where consumers is getting sliced and diced by inflation I don't know we're going to find out right so far based upon that latest earnings and that latest conference call of lemon sounds like it's going to be a little trouble I don't know man we'll see we'll see but it's a very precarious time on what happens with lemon's brand now right so lemon worst case scenario for this year is the stock goes down to $150 to $180 a share which 150 from here that's almost 50% down right uh yeah that's worst case scenario this one will get hit very hard like in order for that to happen revenues probably got to go negative or maybe very slight growth and that would cause panic in regards to Lemon now realistic case in my opinion for Lou Lemon be case that is be case 195 225 let's assume they miss this upcoming quarter they also guide down yeah you could get this stock to to definitely go under 250 and maybe in that 220 range at that point in time which would be you know no fun for L lemon shareholders but if you're a buyer for the long term and you believe in that company for the long term um then maybe it's a great buy the dip opportunity right that leads us to Chipotle Chipotle was a train and that train has lost momentum now Chipotle is still trading at about $82 billion market cap the train momentum has stopped and it stopped at a really bad time because they even had the stock split recently and so the fact that they had that massive like 50 to1 stock split and the train momentum still has lost it's not good so sitting at about a $82 billion market cap the p ratio Skyhigh on this one 63 for this company now Chipotle is going through what I would call a borderline crisis right now there's so much bad publicity all over social media Which social media is just a fancy word for what everybody actually sees right if you were to go on Tik Tok Instagram YouTube over the past month or two so much bad publicity it's all bad publicity really in regards to Chipotle right and some people say all publicity is good publicity I don't know about this one okay because there's just been countless Tik Tok videos Instagram videos YouTube videos showing that Chipotle's sizing is let's just call it not quite there the way it used to be and this is causing a very bad very bad brand uh kind of damaging situation in regards to Chipotle where people are feeling like Chipotle's gone up on price so much over the past few years but they're giving you less product than you've ever gotten before right which makes people very upset and um not as likely to do business with that particular company right now this is not the first crisis type situation spotle had to go through they had to go through a crisis type situation many years ago and I remember seeing this one and um watching all play out and I knew chipot stock was going to crash massively as soon as I started to hear rumors about this and sure enough that stock crashed but Chipotle they had an eoli outbreak many years ago and this caused the stock to get absolutely hammered and if you look right so that stock from basically around the time the coli situation happened to just going like a year later I mean this the crash was insane in that stock for about a year right and so here we are about a month two months deep into this new crisis and could we see a massive crash in the stock over the next 10 12 months it's a potential not guarantee but it's a potential right and then stock started to come back and then it had crash 2.0 and in between that time from where the coli uh outbreak news kind of started to where that stock went to over the next you know couple years there right it was a 61% draw down in Chipotle stock during that particular time 61% massive absolutely massive no prior to that the stock had a parabolic multi-year run look at this this showing you 2010 up until kind of around that eoli outbreak situation right it was a parabolic move the stock went up 700 plus per. right and that was a moment when Chipotle went from people thinking this was going to be more of a niche related company to like oh this is going to be the to the for the masses like everybody's going to eat Chipotle like everybody's Chipotle's customer base where previously people kind of thought like Chipotle might just kind of be in like a niche market like the top 10 20% of income earners might eat it now now you see Chipotle all over the place right I mean you see Chipotle in in places that you just did not see Chipotle 10 years ago right in different areas and whatnot right now this is what's interesting is we're just coming off of a parabolic multi-year run right if you look at the stock 2018 through the first half here of 2024 it was a parabolic run 900 plus% the stock ran in that amount of time so the setup between the coli outbreak right and this really bad branding around them shrinking the sizes and portions of what they're giving you as a customer right uh it's it the it's fascinating to see the setups right like parabolic moves into those situations and then just a super brand damaging situation that could cause brand damage for you know keep in mind if you are branded as you know you're ripping customers off you've gone up on your price a bunch and you're not giving as much if people are viewing you that way just keep in mind that that could last for several years it's not like that lasts for a month or two and then as a company let's say Chipotle wants to try to fight back against that by doing a lot of marketing and advertising well then that's going to hurtt your profitability in a substantial way so these are just kind of you know factors to kind of keep in mind here right now additionally this is another issue with Chipotle is it's not like it's trading cheap the trailing 12 month pric price earnings ratio is at 64 for this stock right 63 64 somewhere around there so we're dealing with the situation in regards to Chipotle where the valuation is Skyhigh on the stock at a moment when suddenly they're having this very damaging brand situation happen that and you read the comments of all these Instagram Tik Tok videos YouTube videos that have come out the past month or two and have gone viral the comments are insanely negative has not very many people sticking up for Chipotle it's just countless people saying you know yeah I've noticed this over the past year or two they're getting cheap on their portions these sorts of things right and so you know this is kind of food for thought when you got a very high valuation that can cause for some pretty epic crashes so Chipotle sets up in a tough situation here because if you look at their gross margins 30 plus% net margin 133% plus right if they load up people's bowls and their burritos right and say okay man you know everybody's honest right now the whole world's paying attention to what we're giving uh for portion sizes so just over portion right okay you can do that but then you're going to hurt your margins right if you want to overp portion chicken and steak and all these different things you're going to hurt your margin it's just bottom line right now on the flip side if you don't load up people's bowls and burritos right now and kind of almost go you know overboard with the portion sizing you're giving there well you're going to get bad press because then everybody's paying attention to this right now and so if you give somebody a small portion guess what they're going to take pictures they're going to post it on their Instagram and their Facebook and wherever else they post stuff right they're going to share it with their friends and family oh I went to Chipotle today yeah what they're saying is right man look here's a picture I took look at this is all they gave me in my bowl today that I ordered on the app like you know that's a problem right now right so you're either going to get more bad word of mouth or you're going to hurt your margins you're really stuck in one of those two situations here if you're Chipotle right now additionally it's even worse because minimum wage just went up in in California so it it's actually kind of confusing because here it says effective January 1st $16 an hour for all employees but then it says fast food restaurant employees effective April first so you're thinking oh 16 no no no no look at this starting April 1st 2024 all fast food restaurant employees who are covered by the new law must be paid at least $20 per hour guess where Chipotle has the most restaurants California and so now if you go to any California Chipotle just understand the workers in there are all getting paid over $20 an hour or we should say at least $20 an hour right now you you tack on all the other cost of having an employee which goes way past just the wage you just got to understand all those folks are getting $20 plus an hour right and the quarter they're about to report is the first quarter that's going to really like hit this company right because they just went into effect in April 1st so we're going to get the first glimpses of like what this is going to mean for Chipotle's profitability right and it's not like it just happens for one quarter it's like next quarter you got to pay these employes 20 plus dollar an hour as well in the next quarter the next quarter right so that's going to be very interesting cuz it's like okay if you're stuck a situation where you got to start loading people's bulls and burritos and you're hurting your margins and then you're getting hit with minimum wage what do you do do you go up on price again on your customer base that's brutal that's a brutal decision right so Chipotle set up in a weird situation here so I would kind of say worst case scenario for the stock it maybe goes to $25 to $35 this year that's a worst case scenario the realistic bare case for the stock in 2024 would be $45 to $55 now of course there's also a potential Chipotle goes up right no different than all these stocks we're only really speaking about the bat downside in in this video but let me just mention the upside for Chipotle a situation where the publicity was nothing but good publicity they got more customers than ever their comps go way above where people people are expecting that uh all the minimum wage uh price hikes that are pretty substantial actually when you run the numbers on that let's say that actually somehow doesn't hurt profitability and margins and you know the companies just go up and up and up uh I mean yeah if that were to happen if that were to happen then you know maybe the stock goes higher but I I mean if I'm going to guess here with the 63p and the wage pressure and all the bad publicity I think the company's going to be in some tough struggles for the remainder of this year maybe into 2025 as well so that's kind of what I'm thinking in regards to Chipotle as far as what I'm rolling with in the public account for my my put position there as of right now I'm rolling with these ones they expire in March March 21st 2025 $63 puts there and I'll ride those ones these particular ones I have now at this point in time I'll ride them into Q4 and I'll ditch him in Q4 at some point in time and then at that point I might re hedge against Chipotle again depending upon where the stocks trading at or and kind of what's going on with the numbers or I might just roll that into something else because usually I do all new fresh hedges in Q4 anyway so we'll see kind of where that one goes okay that leads us to Celsius beverage so Celsius the stock's down 20 plus% in the past month not only that stock's down about 40 what was it 40 plus% 42% or so just in less than two months it's devastating kind of what's going on with Celsius stock and it just seems like day after day the stock goes lower and lower and lower right now the first thing you got to be honest with is Celsius is a top tier stock and I mean the top tier of top tier the stock even after this recent crash of 40 plus% right the Stock's up 3, 600% in the past 5 years now for some reference Nvidia the world changing gamechanging Nvidia the most talked about stock in the market the past year right Nvidia is up 2800% so Celsius beverage over the past 5 years has outdid the Beast that is NVIDIA that's incredible not only that it's outdone my elf elf on a shelf right it beat my elf Alam sitting a little less than 2,700 gain and once again celsia at 3600% even after this crash that's incredible okay so it's we got to give Celsius some dang respect before we start talking about the downside and kind of the current state of Celsius right now the first thing you got to understand about Celsius is they're a big dog now right they are a big dog ever since 22 back in August 2022 they basically made a long-term distribution agreement with Pepsi and whenever you make that long-term distribution agreement with Pepsi or Coca-Cola it usually means you're there you're now a big dog your distribution is likely in just about every convenience store out there just about every uh at least on a domestic front I don't want to say speak about International that's a whole other opportunity there but on domestic side once you're in with with Pepsi for distribution or Coke you're likely in all the convenience stores you're likely in all the food stores you're likely in Walmart you're in Target all those companies right my baby just came out I got to take care of him hold your horses now the other issue when you do one of these big distribution agreements as somebody like a Celsius is usually that next year year and a half you see your revenues fly to the moon and the reason is a lot of times Pepsi or Coca-Cola they can get you into so many more locations than where you at previously they can also get your skews up in a massive massive way and so it it almost is a little bit of a pull forward in demand and it can kind of give you a little bit of unrealistic Revenue growth in the short term which makes a lot of people very excited about your stock but then they kind of get hit with some reality the come down from that maybe a year after two years after is sometimes a little tough because the growth rates kind of fall off in a massive massive way now in regards to Celsius I spoke about it on a video a couple days ago here on the channel I spoke about 12 stocks in that video Celsius is one of them and one of the points I brought out there is the setup for Celsius for the remainder of the this year is horrible horrible setup and the reason being is analysts basically have quarter after quarter for the next four quarters growth accelerating accelerating from 23% to 25% to 27% to 29% that's not a good setup that's not a good setup at all and the reason being is if Celsius is actually in some let's call it more trouble here in the short term what happens if they grow let's say they do hit this quarter's numbers 23% but let's say next quarter they're like you know what not going to quite be there and they report 20% or 19% growth well When You're Expecting 25% that's not good then people start looking they saying well that December quarter was no way they're hitting 27% right so the setup for Celsius is not good at all in the short term here right additionally Celsius is at a 4ward p in the 50s right now right now keep in mind monster forward P for many years during kind of its growth cycle was kind of in the 20 to 35 range right I remember monster paying like a Ford P of like 27 at some points 303 some of those back when I was building out my monster position like that's like over a decade ago now at this point in time right and so Celsius is trading at a pretty dang High forward P but the growth rates have been astronomical I mean look at the re the triling 12month revenue growth 80 plus% once again a lot of that could be that distribution agreement getting into so many new locations so many new SKS in these different locations and it's like a a huge bump up in your business but then you kind of have that that come down right now there's a two-sided worry I would say in regards to Celsius here one is Revenue growth right where's Revenue growth for this company going to actually be at in the coming years because you got understand monster for I mean much of it's history since I follow monster the company's Revenue growth has actually been under 20% it's been kind of in the I would call it anywhere from like 8% to about 18% Celsius is becoming a more mature company you see that with the distribution agreement with Pepsi a couple years ago right and you're seeing it obviously you can pretty much go into just about any store in the United States and you can get Celsius now right that's signs of becoming a more mature company and having a ton of different SKS right I mean shoot I was at Target last night I mean Celsius I mean the amount of different flavors they have in those stores now they have encaps with Celsius they have a huge section in the energy drink category now actually arguably probably in that Target I think there's probably a bigger Celsius section for individual Celsius than Red Bull or Monster right or even rain like it's it's it's insane so Revenue growth there's a worry there right but the second worry is margin growth let's say there's a situation where Celsius management views right now as a time that you know maybe Revenue growth isn't the strongest so they got to capture market share well then you do discounting you do discounting you hurt your margins right and so people invest in these sorts of companies you got to understand for the revenue growth and for the margin growth and if you're missing either one of those then you you know if Revenue growth isn't as strong as you expect or margins even going down or stagnating people don't want to own those stocks during that particular period right remember a lot of Wall Street kind of Traders worried more about the short term so that could cause a lot of pressure on this stock in general if either one of those situations is playing out here over the next kind of few quarters so my opinion in regards to Celsius is worst case for this stock this year is it goes to like 30 to $35 which is actually where the stock was around the time they did that Pepsi deal around the time if you go back and look at the stock chart of where the stock was back to kind of like August 2022 and kind of you know later 2022 it was kind of in that $ 30 to $35 pricing so it would go back there in that situation right and that's that's worst case scenario that would be once again Revenue growth has to continue to disappoint for the next few quarters additionally margins have to get hit if you got that that that double there people are going to freak out in regards to this one and they'll continue to sell and the buyers just won't be there because they're going to be worried about two sides of the story right now realistic bease scenario I see for the stock is kind of 4 5 to $50 range let's assume next quarter is not that strong they have to guide down something like that pull down some numbers yeah you're probably going to that $45 to $55 pricing at that particular time which could be very attractive for long-term investors okay these are some trophies I signed last week we got in the my private 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