Citron Research Cautious on Monster Beverage (MNST); Sees at Least 44% Downside

(Updated - January 29, 2016 12:31 PM EST)

Short seller Citron Research issued a new negative report on Monster Beverage (NASDAQ: MNST) Friday and placed a $80 price objective on the stock.

Citron said Wall Street is valuing the stock like a tech company, although Citron said, " in reality, it is a single product company selling sugar and caffeine water amongst many competitors, whose business is only as strong as its marketing muscle."

Citron highlighted that the company is trading at 9.4x EV / TTM Revenue, which is above averages seen by top-tier tech companies of 6.5x. Meanwhile, beverage peers trade at 3.3x.

"Dr. Pepper Snapple Group's valuation (NYSE: DPS) is 30% smaller than Monster's, despite boasting 100% more revenues and roughly 60% greater EBITDA than Monster," the report highlighted.

The firm gets to a $80 price target by looking at comparable Green Mountain Coffee. MNST has 44% downside based on Green Mountain's take-out price or 64% downside based on the GMCR's price prior to its take-out.

Link to the full Citron report

Citron places $80 price target on $MNST for full story go to https://t.co/Fn9MwJO3Xn Longs have big risk with small reward

— Citron Research (@CitronResearch) January 29, 2016

You May Also Be Interested In

• Humana (HUM) surges on Q1 beat, reiterated adjusted earnings outlook
• Investors turn less bullish on S&P 500 amid inflation, geopolitical risks- Citi
• Visa (V) stock rises as Q2 earnings, revenue come ahead of estimates