Jim Cramer holds back support for surging beverage stock

Jim Cramer chose Coca-Cola (KO) over Celsius Holdings (CELH) during the August 20, 2026 Lightning Round on CNBC's Mad Money. Celsius stock is surging, up about 16% over the past month due to an activist investor pushing for leadership changes. However, Cramer called Coca-Cola the clear winner. This shift follows a rough second-quarter report for Celsius, where revenue was $817.9 million, up 10.6% from a year earlier, but below analysts' expectations.

Adjusted earnings were $0.36 a share, less than the $0.43 expected. Sales of the core Celsius line fell about 11.7% from a year earlier, and profit margins slipped to 48.1% from 51.5%. Cramer's preference for Coca-Cola aligns with a cautious market view, favoring a large, profitable business with reliable income over a smaller, more volatile company.

The growth premium for Celsius is fading as it's being judged more like a traditional beverage company. Integration work for Alani Nu and Rockstar is adding short-term costs and promotional spending, putting pressure on margins. Celsius shares reacted strongly to headlines, with an activist fight underway. Several firms cut their price targets after earnings, with JPMorgan moving to $56 from $70 and Stifel to $45.

For existing or prospective Celsius shareholders, tracking the core brand's performance and the activist fight is crucial. Comparing Coca-Cola's steady growth and dividend against Celsius's potential rebound with higher volatility can help guide investment decisions.