Core Viewpoint - The analyst initiates coverage of Monster Beverage (NASDAQ: MNST) with a STRONG BUY rating, highlighting a personal investment since 2021 at an adjusted price of $43.72, reflecting a compound annual growth rate (CAGR) return of nearly 9% [1]. Group 1: Analyst Background - The analyst is a qualified economist with expertise in economic theory and has been involved in investing and trading since 2005, focusing on US equities since 2018 [1]. - Prior to 2022, the analyst was part of TopStepTrader, successfully passing the combine for a funded trader [1]. - The investment strategy is conservative, utilizing a model that combines quantitative and fundamental analysis to evaluate companies, excluding banks, insurance companies, and REITs [1]. Group 2: Investment Strategy - The main investment strategy involves regularly purchasing shares with a portion of income intended for long-term holding [1]. - The analyst aims to provide private investors with an independent perspective on large and well-known companies through detailed financial statement analysis [1].

Group 1 - The article expresses skepticism about Monster Beverage and highlights the author's focus on identifying the best businesses for long-term portfolio creation [1] - The author aims to outperform the market by analyzing companies within their investment universe [1] Group 2 - No specific financial data or performance metrics are provided in the documents [2][3]

Core Insights - Monster Beverage reported $1.85 billion in revenue for Q1 2025, a year-over-year decline of 2.4% and a surprise of -6.40% compared to the Zacks Consensus Estimate of $1.98 billion [1] - The EPS for the same period was $0.47, an increase from $0.42 a year ago, with an EPS surprise of +2.17% against the consensus estimate of $0.46 [1] Revenue Breakdown - Net Sales from Alcohol Brands were $34.70 million, significantly below the estimated $50.18 million, reflecting a year-over-year decline of -38.1% [4] - Net Sales from Strategic Brands totaled $98.33 million, compared to the estimated $101.81 million, marking a year-over-year decrease of -9.3% [4] - Net Sales from Monster Energy Drinks reached $1.72 billion, slightly below the $1.80 billion estimate, with a year-over-year change of -0.8% [4] - Net Sales from Other categories were $5.98 million, slightly above the estimated $5.95 million, showing a year-over-year increase of +8% [4] Stock Performance - Over the past month, Monster Beverage shares returned +4.1%, while the Zacks S&P 500 composite increased by +13.7% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

Core Viewpoint - Monster Beverage Corporation (MNST) reported mixed first-quarter 2025 results, with earnings exceeding estimates while sales fell short, indicating a complex performance landscape for the company [1][4][5]. Financial Performance - Adjusted earnings were 47 cents per share, beating the Zacks Consensus Estimate of 46 cents, reflecting a year-over-year increase of 10.2% [4]. - Net sales totaled $1.85 billion, missing the Zacks Consensus Estimate of $1.98 billion, and represented a 2.3% decline year over year [5]. - Excluding the Alcohol Brands segment, net sales increased by 1.9% on a foreign-currency adjusted basis [6]. Market Dynamics - The energy drink category saw a dollar sales increase of 8.9% year over year in the convenience and gas channel, with Monster's sales climbing 8.2% [8]. - However, MNST's market share in the energy drink category fell to 36.4% from 37.1%, indicating competitive pressures [9]. Segment Performance - Sales in the Monster Energy Drinks segment decreased by 0.6% to $1.72 billion, impacted by adverse currency rates [11]. - The Strategic Brands segment saw a 9.3% decline in net sales to $98.3 million, primarily due to timing differences in concentrate sales [12]. - Alcohol Brands segment net sales plummeted 38.1% year over year to $34.7 million, driven by reduced sales volumes [13]. Cost and Margin Analysis - The cost of sales decreased by 7.5% year over year to $806.6 million, leading to a gross margin expansion of 240 basis points to 56.5% [15]. - Operating expenses fell by 1.4% to $478.2 million, with distribution expenses down 17.8% [16]. Financial Health - The company ended 2024 with cash and cash equivalents of $1.9 billion and total stockholders' equity of $6.5 billion [17]. - MNST repaid $175 million on its term loan facility in the first quarter and an additional $200 million in April, eliminating outstanding borrowings [18].

Group 1 - Monster Beverage Corporation (NASDAQ: MNST) is recognized for its strong long-term performance in the food market, attracting significant attention from investors [1] - The focus is on identifying companies with a market capitalization of less than $10 billion that have a proven ability to reinvest capital for impressive returns [1] - The ideal companies should demonstrate a long-term capability of capital compounding with a high compound annual growth rate, potentially delivering tenfold returns or greater [1] Group 2 - A conservative investment strategy is primarily adopted, with occasional pursuits of opportunities that present a favorable risk-reward ratio [1] - The approach emphasizes maintaining a long-term perspective on investments to generate higher returns compared to market indices in a rapidly evolving investment landscape [1]

Financial Performance - Net sales for the three-months ended March 31, 2025, were $1.85 billion, a decrease of approximately $44.5 million, or 2.3% compared to $1.90 billion for the same period in 2024[141] - The Monster Energy® Drinks segment generated net sales of $1.72 billion for the three-months ended March 31, 2025, a decrease of approximately $13.5 million, or 0.8% compared to $1.73 billion for the same period in 2024[143] - Net sales for the Alcohol Brands segment were $34.7 million for the three-months ended March 31, 2025, a decrease of approximately $21.4 million, or 38.1% compared to $56.1 million for the same period in 2024[145] - Net sales for the Strategic Brands segment were $98.3 million for the three-months ended March 31, 2025, a decrease of approximately $10.1 million, or 9.3% compared to $108.4 million for the same period in 2024[144] - Net sales to customers outside the United States were $733.2 million for the three-months ended March 31, 2025, a decrease of approximately $10.9 million, or 1.5% compared to $744.1 million for the same period in 2024[132] - Gross billings were $2.16 billion for the three-months ended March 31, 2025, a decrease of approximately $26.7 million, or 1.2% lower than $2.19 billion for the same period in 2024[163] - For the three months ended March 31, 2025, adjusted net sales were $1,813,880, a decrease of 1.3% from $1,837,495 in the same period of 2024[174] Profitability - Gross profit for the three-months ended March 31, 2025, was $1.05 billion, representing a gross profit margin of 56.5%, an increase from 54.1% in 2024[139] - Gross profit was $1.05 billion for the three-months ended March 31, 2025, an increase of approximately $20.8 million, or 2.0% higher than $1.03 billion for the same period in 2024[149] - Operating income for the three-months ended March 31, 2025, was $569.7 million, an increase of 5.1% compared to $542.0 million for the same period in 2024[139] - Operating income was $569.7 million for the three-months ended March 31, 2025, an increase of approximately $27.8 million, or 5.1% higher than $542.0 million for the same period in 2024[153] - Operating income for the Monster Energy® Drinks segment was $680.4 million for the three-months ended March 31, 2025, an increase of approximately $52.2 million, or 8.3% higher than $628.1 million for the same period in 2024[155] - Operating income for the Strategic Brands segment was $51.9 million for the three-months ended March 31, 2025, a decrease of approximately $10.1 million, or 16.3% lower than $62.0 million for the same period in 2024[156] - Operating loss for the Alcohol Brands segment was $21.5 million for the three-months ended March 31, 2025, an increase of approximately $15.5 million, or 257.2% higher than the operating loss of $6.0 million for the same period in 2024[157] Sales Volume - Energy drink case sales for the three-months ended March 31, 2025, were 213,100 (in thousands), an increase of 0.8% compared to 211,430 for the same period in 2024[139] - Case sales for energy drink products were 213.1 million cases for the three-months ended March 31, 2025, an increase of approximately 1.7 million cases or 0.8% higher than 211.4 million cases for the same period in 2024[147] - Total case sales increased to 213,100 from 211,430, representing a growth of 0.8% year-over-year[174] Cash Flow and Debt - Cash provided by operating activities was $507.6 million, up 23.2% from $412.1 million in the prior year[181] - The company had $1.90 billion in cash and cash equivalents as of March 31, 2025, with $1.25 billion held by foreign subsidiaries[177] - Long-term debt includes a $1.50 billion credit facility, with $750 million available under the revolving credit facility as of March 31, 2025[178] - Cash used in financing activities was $145.6 million, an increase from $84.7 million in the same period of 2024, primarily due to repayments on credit facilities[187] Market and Operational Challenges - The company faces risks related to anticipated demand for its products in both domestic and international markets, which could impact sales growth[195] - The company is experiencing challenges with supply chain disruptions, including shortages of shipping containers and port congestion, which could impair product delivery[196] - Rising costs, interest rates, and inflation are expected to impact consumer discretionary income, potentially leading to decreased demand for the company's products[195] - The company is facing competitive pressures that could affect its market share, including misleading claims and pricing strategies from competitors[195] - The company is navigating regulatory challenges, including proposed legislation that could restrict the sale of energy drinks and alcohol beverages[198] Strategic Initiatives - The company is focused on achieving profitability within its Alcohol Brands segment, which remains a key area for growth[195] - The company is exploring market expansion opportunities, particularly in the alcohol beverage sector, to drive future growth[197] - The effectiveness of sponsorships and endorsements, as well as marketing strategies, is under evaluation for both domestic and international markets[201] Inventory and Production Management - The company is committed to managing its inventory levels effectively to mitigate revenue impacts from fluctuations[196] - There is a need for suitable arrangements to procure sufficient capacity for co-packing both domestically and internationally[201] - The company must secure timely procurement of non-defective raw materials to maintain production quality[201] - The company faces challenges in ensuring timely manufacturing by bottlers and co-packers, which may affect product availability[201] Risk Management - Intellectual property rights protection is critical, with potential risks in certain jurisdictions affecting trademark usage[201] - Stock price volatility may restrict stock transactions and impact equity award motivations[201] - Organizational provisions may hinder beneficial changes in control, affecting stockholder interests[201] - Disruptions in information technology systems, including cybersecurity breaches, could negatively impact business operations and customer relationships[201] - Succession planning and retention of senior management and key employees are essential for maintaining operational stability[201]

Core Insights - Monster Beverage reported quarterly earnings of $0.47 per share, exceeding the Zacks Consensus Estimate of $0.46 per share, and up from $0.42 per share a year ago, representing an earnings surprise of 2.17% [1] - The company posted revenues of $1.85 billion for the quarter, missing the Zacks Consensus Estimate by 6.40%, and down from $1.9 billion year-over-year [2] - The stock has increased approximately 15.2% since the beginning of the year, contrasting with a -4.3% decline in the S&P 500 [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.47 on revenues of $2.05 billion, and for the current fiscal year, it is $1.84 on revenues of $7.99 billion [7] - The estimate revisions trend for Monster Beverage is mixed, leading to a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The Beverages - Soft drinks industry is currently in the top 20% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8]

Financial Data and Key Metrics Changes - Reported net sales for Q1 2025 were $1,850 million, a decrease of 2.3% compared to $1,900 million in Q1 2024 [9] - Gross profit as a percentage of net sales increased to 56.5% in Q1 2025 from 54.1% in Q1 2024, driven by pricing actions and supply chain optimization [9] - Operating income for Q1 2025 increased by 5.1% to $569.7 million from $542 million in Q1 2024 [10] - Net income for Q1 2025 was $443 million, slightly up from $442 million in Q1 2024 [11] - Diluted earnings per share increased by 7.4% to $0.45 in Q1 2025 from $0.42 in Q1 2024 [11] Business Line Data and Key Metrics Changes - Sales of Monster energy drink increased by 8.7% in the thirteen-week period ending April 26, 2025 [14] - Sales of Reign decreased by 9.9%, while NOS increased by 0.8% and Full Throttle decreased by 1.5% [14] - The Alcohol Brands segment saw net sales of $34.7 million in Q1 2025, a decrease of approximately 38.1% compared to the previous year [34] Market Data and Key Metrics Changes - In the U.S., the energy drink category grew by 10% in the thirteen weeks ending April 26, 2025 [6] - In EMEA, the energy drink category grew by approximately 13.7% on an FX neutral basis [7] - In APAC, the energy drink category grew by approximately 13.6% on an FX neutral basis [8] - In Latin America, the energy drink category grew by approximately 15.7% on an FX neutral basis [8] Company Strategy and Development Direction - The company is focused on expanding its presence in non-Nielsen measured channels and optimizing its supply chain [41][42] - Plans for further innovation in the Monster Brewing portfolio and the rollout of Predator and Fury brands in international markets are underway [43][44] - The company is exploring opportunities for its alcohol products in certain international jurisdictions [43] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the long-term prospects for the Monster brand, particularly in China and India [31][38] - The energy category continues to grow globally, with increasing household penetration and per capita consumption [41] - Management noted that April 2025 sales were approximately 16.7% higher than the comparable April 2024 sales [39] Other Important Information - The effective tax rate for Q1 2025 was 23.4%, slightly down from 23.5% in Q1 2024 [11] - The company has approximately $500 million remaining for stock repurchase under the previously authorized program [38] - Management indicated that the tariff landscape is complicated but does not expect current tariffs to have a material impact on operating results [13] Q&A Session Summary Question: Impact of supply chain optimization on Q1 numbers - Management acknowledged that Q1 was impacted by bottler distributor ordering patterns and significant closure days of distribution centers [50] Question: Macro impact on retail sales trends - Management noted that consumer demand remains strong, with positive trends in retail takeaway reflected in Nielsen numbers [55][56] Question: Future gross margin expectations - Management indicated that while Q1 margins were strong, they do not expect the same level of margin in Q2 due to rising costs [65] Question: Top line sales versus internal expectations - Management confirmed that there was more innovation in Q1 than in Q2, with some shipment timing impacts to consider [69] Question: Pricing dynamics and market share satisfaction - Management stated that pricing decisions are based on various factors and emphasized the importance of regaining market share [76][77]

Financial Data and Key Metrics Changes - Net sales for Q1 2025 were reported at $1,850 million, a decrease of 2.3% compared to $1,900 million in Q1 2024 [7] - Gross profit as a percentage of net sales increased to 56.5% from 54.1% in the previous year [8] - Operating income increased by 5.1% to $569.7 million from $542 million in Q1 2024 [9] - Net income for Q1 2025 was $443 million, slightly up from $442 million in Q1 2024 [10] - Diluted earnings per share increased by 7.4% to $0.45 from $0.42 in the previous year [10] Business Line Data and Key Metrics Changes - Sales of Monster energy drinks increased by 8.7%, while Reign sales decreased by 9.9% [13] - The Alcohol Brands segment saw a significant decline, with net sales down 38.1% to $34.7 million compared to the previous year [32] Market Data and Key Metrics Changes - In the U.S., the energy drink category grew by 10% year-over-year [5] - In EMEA, the energy drink category grew approximately 13.7% on an FX neutral basis [6] - In APAC, the category grew by 13.6% on an FX neutral basis [6] - In Latin America, the energy drink category grew by 15.7% on an FX neutral basis [6] - Monster's market share in the U.S. convenience and gas channel decreased from 37.1% to 36.4% [14][15] Company Strategy and Development Direction - The company is focused on expanding its product offerings and optimizing supply chains to enhance gross profit [8][9] - Plans for further innovation in the Monster Brewing segment are underway, with new products being launched in various markets [33][34] - The company is optimistic about long-term prospects in China and India, particularly with the rollout of the Predator brand [30][36] Management's Comments on Operating Environment and Future Outlook - Management noted that consumer demand remains strong, with positive trends in retail takeaway [39][40] - The company is optimistic about the energy drink category's growth, citing increasing household penetration and per capita consumption [39] - Management acknowledged challenges from foreign currency exchange rates and adverse weather impacting sales [7][10] Other Important Information - The company has approximately $500 million remaining for stock repurchase under its authorized program [36] - The juice plant at the AFF facility in Ireland is expected to be operational by mid-year 2025 [41] Q&A Session Summary Question: Impact of supply chain optimization on Q1 numbers - Management explained that Q1 was impacted by bottler distributor ordering patterns and distribution center closures, but April showed robust sales [47][48] Question: Macro impact on the energy category - Management indicated that the energy category remains healthy, with positive trends in both the U.S. and international markets [52][54] Question: Future gross margin expectations - Management expects that the second quarter margin will not be as high as Q1 due to rising costs from the Midwest premium [62] Question: Innovation pipeline and shipment timing - More innovation was rolled out in Q1 compared to Q2, with continued acceleration in distribution expected [66] Question: Pricing dynamics and market share satisfaction - Management stated that pricing decisions are based on market opportunities and emphasized the importance of regaining market share [72][73]

能量饮料公司Monster Beverage（MNST）美股盘后下跌6.72%。 ...