Monster Beverage (MNST): Survey Points to Reasonable Expectations, Raising PT - Jefferies

August 18, 2016 8:06 AM EDT
Get Alerts MNST Hot Sheet
Price: $149.81 -0.21%

Rating Summary:
    16 Buy, 8 Hold, 2 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 11 | Down: 23 | New: 30
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Jefferies analyst, Kevin Grundy, reiterated his Hold rating on shares of Monster Beverage (NASDAQ: MNST) after a US focused survey reflects an encouraging increase in penetration rates. The analyst expects some near-term slowing from dissipating pricing however. This should limit the lift from Mutant/Hydro launches. Great story, though at 35x EV/ULFCF, risk-reward looks balanced.

The US Consumer Survey reflects: (i) increasing penetration rates (20% vs. 17% in ’14); (ii) energy drink infringement on more “need states," and (iii) declining “negatives” (owing to relative quiet in D.C.) opens up the possibility to penetrate the ~35% of non-energy drink consumers under an admittedly unlikely "blue-sky" scenario. However, there could be some near-term slowing in the category which would limit the lift from Mutant/Hydro launches.

The price target goes to $175.00 (from $162.00).

For an analyst ratings summary and ratings history on Monster Beverage click here. For more ratings news on Monster Beverage click here.

Shares of Monster Beverage closed at $159.71 yesterday.

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