Monster Beverage Corporation (MNST), headquartered in Corona, California, develops, markets, sells, and distributes energy drink beverages and concentrates. Valued at $53 billion by market cap, the company offers Monster Energy energy drinks, Monster Energy Ultra energy drinks, Monster MAXX maximum strength energy drinks, Java Monster non-carbonated coffee + energy drinks, Caffé Monster non-carbonated energy coffee drinks, and more.
Shares of this beverage company have underperformed the broader market considerably over the past year. MNST has declined 3% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 35.8%. In 2024, MNST stock is down 5.5%, compared to the SPX’s 24.3% rise on a YTD basis.
Narrowing the focus, MNST’s underperformance looks less pronounced compared to the First Trust Nasdaq Food & Beverage ETF (FTXG). The exchange-traded fund has gained about 4.9% over the past year. The ETF’s performance remained unchanged on a YTD basis.
The underperformance of MNST can be linked to decreased footfall in convenience stores and a decline in the energy drink market.
On Aug. 7, MNST reported its Q2 results and its shares closed down more than 10% in the following trading session. Its EPS of $0.41 did not meet Wall Street expectations of $0.45. The company’s revenue was $1.9 billion, falling short of Wall Street forecasts of $2 billion.
For the current fiscal year, ending in December, analysts expect MNST’s EPS to grow 7.1% to $1.66 on a diluted basis. The company’s earnings surprise history is disappointing. It missed the consensus estimate in three of the last four quarters while beating the forecast on another occasion.
Among the 20 analysts covering MNST stock, the consensus is a “Moderate Buy.” That’s based on 11 “Strong Buy” ratings, one “Moderate Buy,” six “Holds,” and two “Strong Sells.”
This configuration is more bullish than a month ago, with 10 analysts suggesting a “Strong Buy.”
On Nov. 5, RBC Capital analyst Nik Modi maintained a “Buy” rating on MNST with a price target of $59, implying a potential upside of 8.4% from current levels.
The mean price target of $54.48 represents a marginal premium to MNST’s current price levels. The Street-high price target of $68 suggests an upside potential of 24.9%.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
