Investors in Monster Beverage (NASDAQ: MNST) were feeling energized on Thursday. The stock jumped 5% by 2 p.m. ET today compared to a 0.4% uptick in the wider market, according to data provided by S&P Global Market Intelligence.
The beverage giant's shares are still trailing the S&P 500 in the past year, though, rising 15% through late February compared to the index's 28% rally.
Thursday's spike was powered by good news on the earnings front.
Good growth news
Monster Beverage announced fourth-quarter results before the market opened on Thursday. That report showed a sparkling 16% sales increase for the three-month period that ran through late December after accounting for currency rate swings. Growth was broad-based, including a nearly 20% spike in its core energy drink portfolio.
The company achieved even faster gains of 30% in its alcoholic beverage segment, thanks to its successful national distribution of the Beast Unleashed brand. "We continue to see sound growth in the energy drink market globally," co-CEO Hilton Schlosberg said in a press release.
The news was just as good around profits, which expanded 21% after accounting for one-time charges. Earnings jumped to $1.6 billion, or 23% of sales, from $1.2 billion, or 19% of sales, in the 2022 fiscal year.
This boost was powered partly by rising beverage demand, along with higher prices and decreased costs on raw materials and freight. Gross profit margin improved by 2 percentage points to reach 54% of sales.
Launching drinks
Investors can expect the next year to be packed with innovative product releases that will determine whether the company can maintain its positive momentum in 2024. Launches will be especially busy in the alcohol category following the strong start for Beast Unleashed. Meanwhile, look for Monster Beverage's profitability to continue rising back toward records as it benefits from slowing cost inflation in 2024.
Should you invest $1,000 in Monster Beverage right now?
Before you buy stock in Monster Beverage, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Monster Beverage wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than tripled the return of S&P 500 since 2002*.
*Stock Advisor returns as of February 26, 2024
Demitri Kalogeropoulos has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Monster Beverage. The Motley Fool has a disclosure policy.
