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Monster Beverage Corporation Message Board

  • blousonblouse blousonblouse Jan 5, 2010 12:07 PM Flag

    analysts opinions

    I only ever take analysts opinions with a pinch of salt- they are info to add into the mix like any other. But the wider market seems to react to their views with moves in sp- and where there are exposed shorts that can lead to a squeeze and a 10% or so spike. so it is helpful to try and anticipate them.

    My guess is that either shortly ahead or immediately after Q4 numbers are posted in 6 weeks or so, there are likely to be a number of buy recomendations- assuming the sp doesn't get ahead of itself before then. this is cos
    - there has not been a sell note on Hans in the last 12 months, despite the depth and uncertainty of recession and it being a discretionary item, and the stock touching $44 in May.That indicates analysts generally like the stock long term
    - I expect confidence to grow in the coming weeks that Hans will hit or beat their full year numbers to Dec10, and if the belief continues that the economy will grow this year then consensus is likely to be upgraded.
    - add in the cash on the balance sheet, and shares being bought back ( and a likely announcement about increasing the buy back) and the $2.46 current consensus for the current year and $2.75 odd next seems too conservative.
    - But even based on that not changing, current sp stripping out likely cash balance and reduced shares in issue is about 14.3 x2010 and 12 x 2011. For a biz that will have grown at almost 20% during the recession ( stripping out the P&L non cash impact from Q4 09 change in distributors) that is too cheap if there is going to be a resumption in growth in the sector.
    Certainly it is a safe call if there is any slippage in the sp back to $37- so one way or another it is worth being exposed to Hans long, as long as you take the long term view thi price is not expensive- tho fairly full value for now without the over performance I expect in 09 +10

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