Monster Attacks Resistance, Logs Big Bang Profit

MNST stock guzzled gains Friday after Monster Beverage beat earnings forecasts late Thursday, boosted by its recent acquisition of Bang Energy. Meanwhile, Celsius Holdings (CELH) spiked ahead of its earnings, due next week.

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Corona, Calif.-based Monster Beverage (MNST) reported double-digit earnings growth for the third quarter in a row, increasing 43% to 43 cents per share. Revenue climbed 14% to a record $1.856 billion, marking three straight quarters of double-digit growth.

Analysts polled by FactSet expected earnings of 40 cents per share on $1.865 billion in sales.

Monster acquired energy drink brand Bang Energy for $362 million at the end of July.

Sales from company’s Monster Energy drinks segment, which now includes Bang Energy drinks, rose 13.7% to $1.71 billion.

The Bang Energy purchase generated a $45.4 million gain for Monster during the quarter. The company incurred about $8 million in acquisition expenses during Q3. Meanwhile, gross profit took a hit of about $7.8 million from setup costs for Bang inventory.

Monster’s alcohol segment sales leapt 57.8% to $42.3 million. The alcoholic beverages unit includes Monster’s The Beast Unleashed drink, which launched in Q1, as well as various craft beers and seltzers.

Strategic brands sales, which includes various energy drink brands purchased from the Coca-Cola (KO) company, rose 11.2% to $98.8 million.

International sales jumped 20.2% to $733.7 million.

Co-CEO Hilton Schlosberg noted gross profit margins improved “significantly” due to pricing actions, lower freight-in costs and declines in aluminum can costs. “The energy drink market in the United States, as well as internationally, continues to grow,” he added.

MNST Stock

MNST stock rallied 5.5% on Friday after spiking more than 11% at the open. Shares leapt above their 50-day and 200-day moving averages at the open, and set up for their fifth straight daily gain.

MNST stock is in a consolidation with a 60.47 buy point. Monster shares are up about 9.5% so far this year.

Elsewhere, Celsius shares bolted 7.7% higher Friday and as gains accelerated for the third day in a row. The Boca Raton, Fla.-based company reports Q3 results early Tuesday.

CELH stock reclaimed short-term support at its 21-day exponential moving average and is working toward its 50-day line.

CELH stock has fallen from its all-time high of 206.85 in September but has still soared nearly 68% in 2023.

You can follow Harrison Miller for more stock news and updates on X/Twitter @IBD_Harrison

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