Monster Beverage (MNST) Looks Poised for Earnings Beat in Q4

Core Viewpoint - Monster Beverage Corporation is expected to report strong revenue and earnings growth for the fourth quarter of 2023, with anticipated revenues of $1.75 billion and earnings of 39 cents per share, reflecting year-over-year growth of 15.9% and 34.5% respectively [1] Financial Performance - The Zacks Consensus Estimate for 2023 revenues is $7.2 billion, indicating a growth of 13.5% from the previous year, while earnings are expected to reach $1.56 per share, suggesting a growth of 39.3% [1] - In the last reported quarter, the company achieved an earnings beat of 2.5% and has delivered an average earnings surprise of 1.9% over the trailing four quarters [2] Key Factors Driving Performance - Continued strength in the energy drinks category is driving Monster Beverage's performance, supported by product innovation and a steady lineup of product launches [3] - The company is expected to benefit from gains in the Monster Energy family of brands and strength in Strategic and Affordable energy brands [3] - Pricing increases, lower freight-in costs, and reduced aluminum can costs are contributing to robust margins, with management strategically adjusting pricing to offset inflationary pressures [4] Market Challenges - The beverage industry presents challenges, including rising costs and shifting consumer preferences impacting volumes of soda and energy drinks [5] - Increased product-mix costs and higher advertising expenses are putting pressure on profits and margins [5] Earnings Prediction - The Zacks model predicts an earnings beat for Monster Beverage, with an Earnings ESP of +10.03% and a Zacks Rank of 3 [6]