Monster Beverage Corporation MNST delivered fourth-quarter 2024 results, wherein the bottom line fell short of the Zacks Consensus Estimate and was flat with the year-ago quarter. Meanwhile, the company’s top line exceeded the Zacks Consensus Estimate and increased year over year.
Monster Beverage Corporation Price, Consensus and EPS Surprise
Monster Beverage Corporation Price, Consensus and EPS Surprise
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Monster Beverage’s adjusted earnings of 38 cents per share missed the Zacks Consensus Estimate of 40 cents per share and were flat year over year.
Net sales of $1.81 billion beat the Zacks Consensus Estimate of $1.79 billion. The top line grew 4.7% year over year. Unfavorable currency translations hurt net sales by $52.3 million. Net sales rose 7.8% on a currency-adjusted basis.
Shares of the Zacks Rank #4 (Sell) company have lost 10.7% in the past three months against the industry’s growth of 3.3%.
MNST Stock's Performance in the Past Three Months
Zacks Investment Research
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A Peek Into MNST’s Q4 Performance
Management highlighted that in the United States the company benefited from sustained growth in the global energy drink category, with strong demand in both convenience stores and other measured retail channels, as reported by Nielsen. More households are buying energy drinks, and per-person consumption is rising, driven by a growing demand for energy-boosting beverages.
Monster Beverage has been reviewing opportunities for price increases internationally. As mentioned in the last earnings, the company is making 5% price increase on its core brands and packages, effective Nov. 1, 2024, in the United States. In the fourth quarter, the company continued to monitor opportunities for further pricing actions in both the domestic and international markets.
Per the Nielsen reports for the 13 weeks through Feb. 15, 2025, for the company’s combined outlets, including convenience, grocery, drug and mass merchandisers, sales in dollars in the energy drink category with energy shots rose 6.2% year over year. Its energy brand sales, including Bang, rose 4.4% in the 13 weeks. Monster’s sales were up 4.8%. Reign’s sales dipped 6.3%. While sales of NOS and Red Bull increased 2% and 10%, respectively, sales of Full Throttle declined 0.8%.
In Europe, the Middle East, and Africa (EMEA), the energy category grew by 14.4%, while in Asia-Pacific (APAC), sales rose by 11.8%. The Latin American market saw the highest growth at 20.2%.
Net sales to customers outside the United States rose 11.7% to $711.5 million, representing about 39.3% of the total net sales. On a currency-adjusted basis, sales to customers outside the United States improved 19.9%.
Insights Into MNST’s Segmental Performance
Monster Energy Drinks: Sales of this segment, which includes Monster Energy drinks, Reign Total Body Fuel high-performance energy drinks, Reign Storm total wellness energy drinks and Bang Energy drinks, rose 4.5% to $1.67 billion. The segment’s sales included a negative impact of $49 million from adverse currency rates. On a currency-adjusted basis, net sales for the segment rose 7.6%.
Strategic Brands: In addition to the affordable energy drink brands, the segment includes a range of energy drink brands acquired from Coca-Cola as well as the company’s affordable energy brands Predator and Fury. The segment’s net sales grew 11.1% year over year to $102 million. Currency headwinds hurt sales by $3.3 million. On a currency-adjusted basis, net sales for the segment rose 14.7%.
Alcohol Brands: Net sales for the segment, which includes The Beast Unleashed, Nasty Beast Hard Tea and several craft beers and hard seltzers, fell 0.8% year over year to $34.9 million due to the soft sales volume of craft beers.
Other: Net sales for the segment, which includes some products of American Fruits & Flavors sold to independent third parties (AFF Third-Party Products), rose 4.6% year over year to $5.1 million.
Analysis of MNST’s Costs & Margins
The cost of sales was $809.6 million, up 2.3% year over year. The company’s gross margin expanded 110 basis points (bps) year over year to 55.3%. The Adjusted gross margin, excluding the impact of Alcohol Brands Inventory Reserves, was 55.5% for the fourth quarter, up 100 bps from 54.5% in the year-ago quarter. The increase in gross margin was driven by lower input cost, somewhat offset by geographical sales mix.
Adjusted operating expenses grew 5.5% year over year to $488.7 million, due to higher impairment charges within the Alcohol Brands segment, escalated payroll expenses and increased sponsorship and endorsement expenses related to intellectual property claims. As a percentage of sales, adjusted operating expenses increase 20 bps to 27%.
Selling expenses, as a percentage of net sales, increased 50 bps year over year to 10.7%. Distribution costs, as a percentage of net sales, fell 30 bps to 4.3%. Adjusted general and administrative expenses, as a percentage of net sales, were flat year over year at 12%.
MNST’s Financial Health
Monster Beverage ended 2024 with cash and cash equivalents of $1.5 billion and total stockholders' equity of $6 billion.
The company did not repurchase any shares under its current share repurchase program in the fourth quarter of 2024. As of Feb. 26, 2025, roughly $500 million was available for buyback under its existing share repurchase program.
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