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MarketScreener Homepage  >  Equities  >  Nasdaq  >  Monster Beverage Corp    MNST

MONSTER BEVERAGE CORP

(MNST)
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Delayed Quote. Delayed Nasdaq - 05/21 04:00:00 pm
63.74 USD   +0.20%
05/03Monster, Weight Watchers rise while Arista, Activision fall
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05/02MONSTER BEVERAGE : 1Q Earnings Snapshot
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05/02Monster Beverage Reports 2019 First Quarter Financial Results
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Energy-Drink Upstarts Are Sapping Monster's Strength

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04/17/2019 | 07:15am EDT

By Jennifer Maloney

The king of energy drinks is in need of a boost.

Monster Beverage Corp. is losing market share, fighting in court with an upstart competitor and trying to stop its biggest partner -- Coca-Cola Co. -- from releasing an energy version of Coke.

Now Keurig Dr Pepper Inc. is jumping in with an energy drink developed by Lance Collins, the entrepreneur behind successful brands including Fuze tea, BodyArmor sports drinks and Core bottled water. His new drink, Adrenaline Shoc, is meant to appeal to consumers looking for less sugar and more natural ingredients, Mr. Collins said.

"Traditional energy drinks have ingredients that you can't pronounce: glucuronolactone, inositol, taurine," he said. "We took all those things out."

It is a consumer shift that beverage industry analysts say Monster has struggled to address.

Monster accounted for 41% of energy-drink sales in American retail stores in the four weeks ended April 7, down from 45% a year earlier, according to an Evercore ISI analysis of data from IRI, a market research firm. Meanwhile, a new entrant called Bang has quickly captured about 9% of the market.

A Monster spokeswoman referred to its previous comments, criticizing Bang for "false and unsupported" health claims. At an investor meeting in January, Monster CEO Rodney Sacks said fitness-oriented energy drinks like Bang will end up expanding the category, allowing Monster to continue to grow.

Monster is touting a new brand called Reign, which contains coenzyme Q10, a dietary supplement taken for heart health. "Will we have competition? Sure, we will. But we've had competition before," Mr. Sacks said in January. "Ultimately, we're confident about the ability of Monster to continue to grow and the ability of Reign to participate in that space."

The Monster brand has nothing to do health and wellness, Evercore ISI analyst Robert Ottenstein said. "Monster recognized that to their credit. They recognized that they couldn't use the Monster trademark to go after Bang. The question is are they going to be able to do it? There's a whole new wave of brands with authenticity in the fitness space."

Other players are crowding into the category: Anheuser-Busch InBev SA in 2017 bought organic energy-drink startup Hiball Inc. And Amazon.com Inc. just launched its own energy drink under its Solimo brand.

Coca-Cola, which owns an 18.5% stake in Monster and distributes the brand through its bottling network, has developed a drink called Coca-Cola Energy that is already being introduced in Europe. Monster says the move is a violation of an agreement the companies struck in 2015; they are in arbitration.

Bang also has drawn Monster into a fight. In September, Monster sued Bang's parent company, Vital Pharmaceuticals Inc., alleging that it doesn't contain creatine, the ingredient it touts prominently on its cans, and that the company had made false health claims about its product. Monster also raised concerns about those health claims with the Food and Drug Administration, according to a person familiar with the matter. Monster's March launch of Reign was a parallel attack on Vital, with the new brand's packaging and flavors closely mirroring Bang's.

Vital has sued Monster alleging trademark infringement and refutes Monster's charges.

"A meritless and frivolous lawsuit has no chance to prevent the inevitability of Bang's meteoric rise to the top," Vital said in a September news release. "Consumers choose Bang because it's more effective, tastes better, and doesn't contain harmful amounts of sugar and ingredients like D-glucuronolactone contained in Monster."

Monster called Vital's trademark suit a bad faith attempt to slow its Reign launch.

Keurig Dr Pepper has taken a significant minority stake in Adrenaline Shoc with a path to ownership and will distribute it nationally. Terms weren't disclosed. The deal comes unusually early in the brand's development. Typically startup brands build sales on their own before striking a national distribution agreement. This one has yet to appear in a single store. Keurig plans to launch it in June.

With the energy-drink category fragmenting, Keurig Dr Pepper said it wants to offer consumers a range of options. It already owns two small traditional energy-drink brands and earlier this month said that it would distribute Runa Clean Energy, an organic energy drink with caffeine derived from the Guayusa leaf. Runa is owned by All Market Inc., which also owns Vita Coco coconut water.

Adrenaline Shoc has no sugar and contains caffeine derived from green coffee beans, yerba mate, coffee-bean fruit extract and guarana.

Write to Jennifer Maloney at jennifer.maloney@wsj.com

Stocks mentioned in the article
ChangeLast1st jan.
COCA-COLA COMPANY (THE) -0.51% 48.6 Delayed Quote.2.64%
KEURIG DR PEPPER -0.27% 29.07 Delayed Quote.13.38%
LONDON SUGAR 1.18% 326.8 End-of-day quote.-2.16%
MONSTER BEVERAGE CORP 0.20% 63.74 Delayed Quote.29.50%
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Financials ($)
Sales 2019 4 210 M
EBIT 2019 1 453 M
Net income 2019 1 119 M
Finance 2019 1 091 M
Yield 2019 -
P/E ratio 2019 31,13
P/E ratio 2020 27,74
EV / Sales 2019 7,95x
EV / Sales 2020 7,19x
Capitalization 34 577 M
Chart MONSTER BEVERAGE CORP
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Monster Beverage Corp Technical Analysis Chart | MarketScreener
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Technical analysis trends MONSTER BEVERAGE CORP
Short TermMid-TermLong Term
TrendsBullishNeutralNeutral
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 19
Average target price 67,3 $
Spread / Average Target 5,7%
EPS Revisions
Managers
NameTitle
Rodney Cyril Sacks Chairman & Chief Executive Officer
Hilton Hiller Schlosberg Vice Chairman, President, COO, CFO & Secretary
Mark J. Hall Director
Norman C. Epstein Independent Director
Gary P. Fayard Independent Director
Sector and Competitors
1st jan.Capitalization (M$)
MONSTER BEVERAGE CORP29.50%34 577
COCA-COLA COMPANY (THE)2.64%208 400
PEPSICO17.66%182 223
KEURIG DR PEPPER13.38%41 005
FOMENTO ECONOMICO MEXICANO, SAB DE CV11.53%31 928
COCA-COLA EUROPEAN PARTNERS PLC22.81%26 668