Monster Beverage has successfully reached the target price from our previous report. The company reported mixed results for the first quarter of 2021 where the bottom line lagged the analyst consensus whereas sales surpassed the same. This was primarily the result of increased input costs mainly increased raw material freight in costs, geographical sales mix, and higher promotional allowances as a percentage of net sales. Nevertheless, the company continues to gain from its energy drink category, particularly the Monster Energy mother brand. The company’s revenue performance has been stellar throughout the pandemic and the supply chains have not been materially impacted. The rising demand for its products is resulting in a greater need for aluminum cans which the management is planning to source from South America and Asia in the coming months though its rising costs could be a potential headwind. Some of the other big worries for investors would include gross margin contraction and the company’s arch rival, Redbull gaining market share. We maintain our ‘Hold’ rating on the stock with a revised target price.
Our Report Structure:
⦁ Company Overview
⦁ Investment Thesis
⦁ Key Drivers
⦁ Historical Quarterly Statement Analysis – Income Statement & Cash Flows
⦁ Historical Quarterly Balance Sheet Analysis
⦁ Historical Annual Financial Statement Analysis
⦁ Analysis Of Key Financial Ratios
⦁ Financial Forecasts For 3 Years
⦁ Forecasting The Capital Structure & Net Debt
⦁ Discounted Cash Flow Valuation
⦁ Trading Multiples
⦁ Key Risks
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