In 2023, the artificial intelligence (AI) rally pulled all attention to the top tech players dominating the S&P 500 Index ($SPX) and the tech-led Nasdaq Composite ($NASX). However, the Russell 2000 Index (RUT), which focuses on small-cap companies, includes some outstanding names that have received top Wall Street ratings and are expected to grow significantly in the long run.

With an increasing number of people opting for healthier beverage choices, Celsius Holdings (CELH) has tapped into a growing market, which has sent its revenue soaring in the last five years. More so, the beverage company's fortunes turned after John Fieldly took over the reins as the company’s CEO in 2018. Its stock has gained a staggering 4,161% in the last five years, and an eye-popping 37,035% in the last decade, wildly outperforming its biggest competitor, Monster Beverage(MNST).

The second small-cap is healthcare service company Option Care Health (OPCH) - which may not appear exciting at first glance, with its stock up only 11.7% in the last 52 weeks. However, its strong financials may compel you to take a second look. Let's find out why analysts rate these two stocks as a "strong buy." 

Celsius Holdings

Founded in 2004, Celsius Holdings is sparkling in the highly competitive beverage industry, offering a refreshing and healthier option. Health-conscious consumers are increasingly looking for tasty but healthier options over traditional sugary drinks. With a commitment to fitness, wellness, and innovation, Celsius Holdings has introduced a line of fitness drinks to provide a boost of energy without the guilt associated with sugary sodas and energy drinks.

The stock has gained 59% over the last one year, outperforming the S&P 500 by a wide margin. In November, the company announced a three-for-one split of its common stock. 

According to Statista, Celsius ranked third among the leading energy drink brands (non-alcoholic beverages) in the U.S. in 2023. Celsius boasts of using natural ingredients such as green tea extract, ginger, and guarana in its products that are free from artificial preservatives, sweeteners, and colors.  

Though its high valuation (forward price-to-earnings ratio of 60) may deter investors, the company's financials have been steadily improving, which has been the key factor driving its stock price. For instance, its revenue has increased from $52.6 million in 2018 to $653.6 million in 2022.

In its recent third quarter, revenue jumped 104% year-on-year to $385 million, with North America contributing 96% to total revenue. Celsius also reported diluted earnings of $0.89 per share, compared to a loss of $2.46 per share in the prior-year quarter.

The company also highlighted that Celsius was the highest-selling energy drink on Amazon for the 14 weeks ended Sept. 30, holding a 21.4% market share in the energy drink category. Meanwhile, Monster Beverage's market share stood at 18.6%.

Celsius has a lot of scope in the global market that could further amplify its revenue in the long term. For this, the company has taken the help of PepsiCo (PEP). In 2022, both companies entered into a distribution agreement for PepsiCo to be its global distribution partner, while holding an 8.5% stake in Celsius. International sales, which were up 56% in Q3, could get a serious boost going forward. 

Analysts predict explosive growth for Celsius in 2024, with a 38.6% revenue surge and a 31% growth in earnings expected. As the market shifts toward healthier beverage options, Celsius stands to benefit tremendously.

What Is The Target Price For CELH Stock?

Despite the outsized gains last year, Wall Street expects Celsius stock to skyrocket in 2024. The average target price of $116.67 implies a potential upside of 124% from current levels. While it’s hard to predict whether it will soar as much as last year, Celsius makes a compelling case for a solid long-term investment.

Out of the 14 analysts covering the stock, 12 rate it a “strong buy,” while two recommend a “hold.” Priced at 60 times forward earnings and seven times forward sales, Celsius appears to be expensive. However, its long-term growth prospects may justify paying a premium.

Option Care Health

Option Care Health is a top provider of home care and alternate-site infusion therapy services. Specializing in delivering critical medications and therapies directly to patients in the comfort of their homes, Option Care focuses on improving patient experiences and outcomes.

Over the last five years, Option Care has increased its revenue from $1.9 million to $3.9 million. The company’s earnings have also improved from a loss of $6.1 million to a profit of $150 million over the same period. 

Option Care does not pay dividends, so its earnings have been reinvested back into the business, which has fueled the earnings growth.

In its third quarter, revenue increased 7.1% to $1.09 billion, while earnings jumped an impressive 45% year-over-year to $0.31 per share. Management expects revenue to range between $4.23 billion and $4.28 billion in 2023, which is consistent with analyst estimates.

Looking ahead, analysts expect revenue growth of 8.3% for 2024, while earnings might dip to $1.16 per share, compared to $1.44 estimated for 2023.

Option Care is leveraging AI to improve its efficiency and services. This month, the company announced a multi-year agreement with Palantir Technologies(PLTR) to use its AI systems for nurse scheduling, patient onboarding, supply chain execution, and other purposes.

The aging population is driving up demand for home healthcare services, which are less expensive, more convenient, and provide a higher quality of life. The U.S. home healthcare services market is expected to grow at a compounded annual growth rate of 7.2% to $156.28 billion by 2030. This provides ample opportunity for Option Care Health in the coming years.

What Is The Target Price For OPCH Stock?

Analysts have assigned a "strong buy" rating to OPCH stock. Out of the eight analysts who cover the stock, all rate it a "strong buy." The average target price for the stock is $39, which is 21.7% higher than the current levels.