Needham analyst Gerald Pascarelli has maintained their neutral stance on MNST stock, giving a Hold rating today.
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Gerald Pascarelli has given his Hold rating due to a combination of factors impacting Monster Beverage’s recent performance and market positioning. The company reported a slight miss in both topline and earnings per share, attributed to unfavorable order patterns affecting first-quarter sales. However, the second quarter has shown promising signs with local currency sales increasing by 16.7%.
Despite the revenue shortfall, Monster Beverage’s strong gross margin contributed to a significant expansion in operating margin and high single-digit EPS growth. As a market leader, the company is well-positioned to capitalize on the robust growth of the energy drink category. Nevertheless, much of this positive outlook seems to be already reflected in the stock’s current valuation, which is trading at a 10% premium compared to its one-year average price-to-earnings ratio.
Pascarelli covers the Consumer Defensive sector, focusing on stocks such as Molson Coors, Celsius Holdings, and Boston Beer. According to TipRanks, Pascarelli has an average return of -2.3% and a 44.29% success rate on recommended stocks.
In another report released today, UBS also maintained a Hold rating on the stock with a $63.00 price target.