Monster Beverage gains after company continues streak of annual revenue growth
Caffeinated beverage sales still have some pep in their step.
Shares of Monster Beverage rose 3.5% after market close on Thursday after the company delivered another year of revenue growth, fueled by sustained demand in the fiercely-competitive energy drinks industry.
The beverage maker reported record Q4 sales of $1.81 billion, modestly beating Wall Street estimates and bringing the company’s full-year revenue to $7.49 billion, a 5% increase from 2023 to continue its impressive multi-decade streak of annual revenue growth.
Monster’s sales beat was driven by continued growth in its energy drinks — including Bang Energy, Reign, and its namesake Monster Energy — with a rebound in sales at convenience stores, the company said. A 5% price increase on some of its products also contributed, while excess inventory in its alcohol segment continued to weigh on results.
The company’s adjusted earnings per share, meanwhile, came in at $0.38, missing estimates of $0.40 according to analysts polled by Bloomberg.
The stock’s latest rise helps ease some recent pressure. Up until mid-last year, Monster had been on a tear, touted as the “best-performing stock of the last 30 years” with a roughly 200,000% gain from 1994 after its co-CEOs capitalized on a young market for highly caffeinated beverages.
But the emergence of a host of buzzy, sugar-free brands in recent years have threatened the long-held dominance of front-runner Redbull and runner-up Monster, leading to slowing sales and revenue growth in recent quarters and sending Monster’s stock on a 7% downward spiral in the last year.
Celsius has made particularly strong headway in the energy drinks industry, finding a place next to fitness gurus and athletes with its supposed health benefits to notch the third top spot by market share. The company topped Q4 estimates last week and announced a $1.65 billion acquisition of up-and-coming Alani Nutrition, a brand popular with women and Gen-Z, though its stock has faced pressure as PepsiCo, its lead US distributor, has dialed back orders.
The $21 billion dollar industry’s rise hasn’t escaped backlash from health professionals and consumer advocacy groups, though. Some have warned of the beverages’ link to eating disorders and anxiety among teens, while others have criticized brands’ seemingly kid-oriented marketing, with flavors like Bang’s Cotton Candy and Ghost’s candy-inspired flavors like Swedish Fish.
