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

Monster Beverage Corporation MNST is expected to report fourth-quarter 2023 results on Feb 28, after the closing bell. The beverage company is anticipated to have witnessed revenue and earnings growth in the to-be-reported quarter.

The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $1.75 billion, indicating growth of 15.9% from the reported figure in the year-ago quarter. The consensus estimate for earnings of 39 cents per share suggests growth of 34.5% from the year-ago quarter’s actual. The consensus mark has been unchanged in the past 30 days.

The Zacks Consensus Estimate for MNST’s 2023 revenues is pegged at $7.2 billion, indicating growth of 13.5% from the figure reported in the year-ago quarter. The consensus mark for earnings is pegged at $1.56 per share, which suggests growth of 39.3% from the year-ago quarter’s reported figure. The consensus mark has been unchanged in the past 30 days.

In the last reported quarter, the company reported an earnings beat of 2.5%. It has delivered an earnings surprise of 1.9%, on average, in the trailing four quarters.

Monster Beverage Corporation Price and EPS Surprise

Monster Beverage Corporation Price and EPS Surprise

Monster Beverage Corporation price-eps-surprise | Monster Beverage Corporation Quote

Key Factors to Note

Monster Beverage has been experiencing continued strength in its energy drinks category, which has been driving its performance. The company has been benefiting from the expansion of the energy drinks category and product launches. Product innovation has played a significant role in the company's success. This is likely to have boosted the top and bottom-line performances in the fourth quarter.

The company’s fourth-quarter results are particularly expected to have reflected gains from the Monster Energy family of brands, and strength in Strategic and Affordable energy brands. The steady lineup of product launches is likely to have helped retain its business momentum. The company is anticipated to have reaped gains from its strong distribution network in international markets and investments in growth opportunities.

Pricing increases, along with lower freight-in costs and reduced aluminum can costs, have been contributing to robust margins. Management has been strategically adjusting its pricing in response to the ongoing inflationary cost pressures. These pricing actions have been designed to balance the need to offset increased costs while maintaining customer loyalty and demand.

The company has been benefiting from its pricing actions across various regions to negate the impacts of rising commodity costs and inflation. MNST continued to implement price hikes in the third quarter of 2023, with additional price hikes planned in several other markets through the remainder of the year. These are expected to have bolstered margins and top lines in the to-be-reported quarter.

Monster Beverage’s fourth-quarter margins are expected to have witnessed gains from the easing of the supply-chain headwinds, particularly reduced freight costs.

However, the beverage industry presents substantial challenges for Monster Beverage, primarily related to the dynamic retail and consumer landscape. The company has been witnessing rising costs. The shift in consumers’ preferences has been impacting the volumes of soda beverages and energy drinks. Its profits and margins have been particularly pressured due to higher product-mix costs and stepped-up advertising expenses.

What the Zacks Model Unveils

Our proven model conclusively predicts an earnings beat for Monster Beverage this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Monster Beverage has an Earnings ESP of +10.03% and a Zacks Rank of 3.

Other Stocks With the Favorable Combination

Here are three other companies worth considering, as our model shows that these also have the correct combination to beat on earnings this time:

Inter Parfums IPAR has an Earnings ESP of +5.71% and a Zacks Rank of 2, at present. The company is slated to witness top-line growth when it reports fourth-quarter 2023 results. The Zacks Consensus Estimate for IPAR’s quarterly revenues is pegged at $329 million, which suggests growth of 5.9% from the figure reported in the year-ago quarter.

You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Inter Parfums’ quarterly earnings has moved up 9.4% in the past 30 days to 35 cents per share. However, the consensus mark for earnings suggests a decline of 5.7% from the year-ago quarter’s reported number. IPAR has delivered an earnings surprise of 45.7%, on average, in the trailing four quarters.

Celsius CELH has an Earnings ESP of +4.82% and a Zacks Rank of 3, at present. The company is expected to report top and bottom-line growth when it reports fourth-quarter 2023 results. The Zacks Consensus Estimate for its quarterly revenues is pegged at $324 million, which suggests growth of 82% from the figure reported in the year-ago quarter.

The Zacks Consensus Estimate for Celsius’ quarterly earnings has been unchanged in the past 30 days at 16 cents per share. The consensus mark for earnings suggests substantial growth from 1 cent per share reported in the year-ago quarter. CELH has delivered an earnings surprise of 110.9%, on average, in the trailing four quarters.

Vita Coco Company COCO has an Earnings ESP of +15.38% and a Zacks Rank of 3, at present. The company is expected to witness top and bottom-line growth when it reports fourth-quarter 2023 results. The Zacks Consensus Estimate for COCO’s quarterly earnings has been unchanged in the past 30 days at 9 cents per share. The consensus mark for earnings suggests 125% growth from that reported in the year-ago quarter.

The Zacks Consensus Estimate Vita Coco’s quarterly revenues is pegged at $98 million, which indicates growth of 6.5% from the figure reported in the prior-year quarter. COCO has delivered an earnings surprise of 25.7%, on average, in the trailing four quarters.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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Vita Coco Company, Inc. (COCO) : Free Stock Analysis Report

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Monster Beverage Corporation (MNST) : Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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