It's been a sad week for Monster Beverage Corporation (NASDAQ:MNST), who've watched their investment drop 10% to US$62.42 in the week since the company reported its yearly result. Results were roughly in line with estimates, with revenues of US$4.2b and statutory earnings per share of US$2.03. This is an important time for investors, as they can track a company's performance in its report, look at what top analysts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether analysts have changed their mind on Monster Beverage after the latest results.
Taking into account the latest results, the latest consensus from Monster Beverage's 14 analysts is for revenues of US$4.61b in 2020, which would reflect a notable 9.6% improvement in sales compared to the last 12 months. Statutory earnings per share are expected to accumulate 9.4% to US$2.24. Yet prior to the latest earnings, analysts had been forecasting revenues of US$4.58b and earnings per share (EPS) of US$2.26 in 2020. So it's pretty clear that, although analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
There were no changes to revenue or earnings estimates or the price target of US$70.81, suggesting that the company has met expectations in its recent result. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Monster Beverage analyst has a price target of US$78.00 per share, while the most pessimistic values it at US$56.00. This shows there is still quite a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
It can also be useful to step back and take a broader view of how analyst forecasts compare to Monster Beverage's performance in recent years. We can infer from the latest estimates that analysts are expecting a continuation of Monster Beverage's historical trends, as next year's forecast 9.6% revenue growth is roughly in line with 11% annual revenue growth over the past five years. Compare this with the wider market, which analyst estimates (in aggregate) suggest will see revenues grow 4.0% next year. So although Monster Beverage is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider market.
The Bottom Line
The most obvious conclusion from these results is that there's been no major change in the business' prospects in recent times, with analysts holding earnings per share steady, in line with previous estimates. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - and our data does suggest that Monster Beverage's revenues are expected to grow faster than the wider market. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have estimates - from multiple Monster Beverage analysts - going out to 2022, and you can see them free on our platform here.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.