Monster(US:MNST)2024-07-24 00:31Investment Rating - The report maintains a NEUTRAL rating for Monster Beverage Corp (MNST US) with a target price of US$52.00, down from a previous target of US$60.00 [3][11]. Core Insights - Growth in the United States has slowed, but gross margins have expanded steadily, with Q1 2024 revenue at US$1,899 million (+11.8% YoY), operating profit at US$542 million (+11.7% YoY), and net profit at US$442 million (+11.2% YoY) [7][11]. - The company expects revenue growth to be driven by improvements in gross margin and price increases, with a projected gross margin of 54.3% in 2024 and 55.7% in 2025 [10][11]. Summary by Sections Financial Performance - For 2024, the company forecasts revenue of US$7.95 billion, net profit of US$1.81 billion, and EPS of US$1.74, reflecting year-on-year increases of 11.3%, 11.0%, and 12.3% respectively [11][6]. - The gross margin for Q1 2024 was reported at 54.1%, with an operating expense ratio of 25.5%, indicating a year-on-year improvement [10][11]. Regional Performance - Sales growth in North America was +8.1%, while Europe saw a significant increase of +28.4%. The Asia-Pacific region showed a modest growth of +0.2% [9][11]. - In the Chinese market, sales increased by 16.4% YoY, indicating strong potential for future growth [9][11]. Market Dynamics - The energy drink category in the U.S. is experiencing slower growth due to high previous growth rates and market saturation, but non-tracking channels like F&B and e-commerce are expected to perform better [8][9]. - The company has launched a new brand, "Hunting Beast," in China, which has received a positive initial response [9][10].