October 24, 2024
Top 10 Stock Monster Beverage Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Monster Beverage – Top 10 Stock in S&P 500 Consumer Staples Index
Monster Beverage is listed as a top 10 stock on October 24, 2024 in the market index S&P US Consumer because of its high performance in at least one of the Obermatt investment strategies. Three consolidated Obermatt Ranks are above-average. Only the Value Rank is below average. The investment rationale may be an investment in future growth, supported by professional market opinion. Based on the Obermatt 360° View of 54 (high 54% performer), Obermatt assesses an overall buy recommendation for Monster Beverage on October 24, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Soft Drinks |
| Index | Human Rights, NASDAQ 100, NASDAQ, S&P US Consumer, S&P US Food & Beverage, S&P 500 |
| Size class | X-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Monster Beverage Buy
| 360 METRICS | October 24, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 3 |
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| GROWTH | ||||||||
| GROWTH | 51 |
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| SAFETY | ||||||||
| SAFETY | 96 |
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| SENTIMENT | ||||||||
| SENTIMENT | 63 |
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| 360° VIEW | ||||||||
| 360° VIEW | 54 |
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ANALYSIS: With an Obermatt 360° View of 54 (better than 54% compared with alternatives), overall professional sentiment and financial characteristics for the stock Monster Beverage are above average. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Monster Beverage. The consolidated Growth Rank has a good rank of 51, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth, as well as stock returns. This means that growth is higher than for 51% of competitors in the same industry. The consolidated Safety Rank at 96 means that the company has a financing structure that is safer than 96% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, the consolidated Sentiment Rank has a good rank of 63, which means that professional investors are more optimistic about the stock than for 63% of alternative investment opportunities. But the consolidated Value Rank is less desirable at 3, meaning that the share price of Monster Beverage is on the higher side compared with indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 97% of alternative stocks in the same industry. ...read more
RECOMMENDATION: With a consolidated 360° View of 54, Monster Beverage is better positioned than 54% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as above-average growth (Growth Rank of 51), a safe financing structure (Safety Rank of 96), and positive professional market sentiment (Sentiment Rank of 63), it is a solid stock investment where growth may be the strongest driver of the investment rationale, also reflected by institutional investors. It is typical for growth companies to have low value, as is the case here. Investors are willing to pay more for companies that outperform their competitors. So the question is, how much more do you pay for the stock of Monster Beverage compared with alternatives? You can use the following rule of thumb: The growth rank measures the growth momentum of the company (51% better than peers). The value rank could be the reverse reflection of that (49%). A Value Rank below that level may be assessed as expensive, a rank above that is still good value. Sometimes market sentiment just reflects the past, sometimes the reality. You pay more than the market average for this stock, but it may be worth it. ...read more
Sentiment Strategy: Professional Market Sentiment for Monster Beverage positive
ANALYSIS: With an Obermatt Sentiment Rank of 63 (better than 63% compared with alternatives), overall professional sentiment and engagement for the stock Monster Beverage is above average. The Sentiment Rank is based on consolidating four sentiment indicators where all but one are above average for Monster Beverage. Analyst Opinions are at a rank of 53 (better than 53% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. The Professional Investors rank is also good at 67, which means that currently, professional investors hold more stock in this company than in 67% of alternative investment opportunities. Pros tend to favor investing in this company. In addition, Market Pulse has a rank of 72 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 72% of competitors). But Analyst Opinions Change has a below-average rank of 33, which means that stock research experts are currently changing their opinions for the worse when it comes to recommending this stock. In other words, they are getting more critical of investments in Monster Beverage. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 63 (more positive than 63% compared with investment alternatives), Monster Beverage has a reputation among professional investors that is above-average compared with that of its competitors. This is an early sign of caution, even if the stock has significantly appreciated. If analysts change their opinions, the stock may become too expensive. If the price is on the way down, the trend may continue. This may be a stock with a good reputation and history, but it may have reached its breaking point by now. Investors should look at the Value Ranks as well. If they indicate trouble, it might just materialize in the future. ...read more
Value Strategy: Monster Beverage Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 3 (worse than 97% compared with alternatives), Monster Beverage shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Monster Beverage. Price-to-Sales is 1 which means that the stock price compared with what market professionals expect for future profits is higher than 99% of comparable companies, indicating a low value concerning Monster Beverage's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 14, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Monster Beverage. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 9 and Dividend Yield, which is lower than 99% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 3, is a sell recommendation based on Monster Beverage's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Monster Beverage? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Monster Beverage? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Monster Beverage may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. ...read more
Growth Strategy: Monster Beverage Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 51 (better than 51% compared with alternatives), Monster Beverage shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Monster Beverage. Sales Growth has a rank of 82, which means that, currently, professionals expect the company to grow more than 82% of its competitors. Profit Growth with a rank of 53 is also above average. But Capital Growth has only a rank of 19, and Stock Returns with 47 are also below-average. Stock returns for Monster Beverage have recently been below 53% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 51, is a buy recommendation for growth and momentum investors. Are investors forecasting troubles based on the lack of operating investment activity at the company? This could be one explanation as to why stock returns are low. But stock returns can also be the result of correcting an error in the past, in this case, an overly optimistic outlook on the future, which is now more realistic. The Value Ranks may confirm such a picture. The more important growth indicators are revenues and profits, which are both above average for Monster Beverage. This is a positive sign from the company's operational side and may give investors courage, despite the poor recent stock price performance. ...read more
Safety Strategy: Monster Beverage Debt Financing Safety very solid
| SAFETY METRICS | October 24, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 92 |
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| REFINANCING | ||||||||
| REFINANCING | 39 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 100 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 96 |
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ANALYSIS: With an Obermatt Safety Rank of 96 (better than 96% compared with alternatives) for 2024, the company Monster Beverage has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Monster Beverage is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above average for Monster Beverage. Leverage is at a rank of 92, meaning the company has a below-average debt-to-equity ratio. It has less debt than 92% of its competitors. Liquidity is also good at a rank of 100, meaning the company generates more profit to service its debt than 100% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 39, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 61% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 96 (better than 96% compared with alternatives), Monster Beverage has a financing structure that is significantly safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Monster Beverage. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. ...read more
Combined financial peformance: Monster Beverage Below-Average Financial Performance
| COMBINED PERFORMANCE | October 24, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 3 |
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| GROWTH | ||||||||
| GROWTH | 51 |
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| SAFETY | ||||||||
| SAFETY | 100 |
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| COMBINED | ||||||||
| COMBINED | 42 |
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ANALYSIS: With an Obermatt Combined Rank of 42 (worse than 58% compared with investment alternatives), Monster Beverage (Soft Drinks, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Monster Beverage are low in value (priced high) with a consolidated Value Rank of 3 (worse than 97% of alternatives). But they show above-average growth (Growth Rank of 51) and are safely financed (Safety Rank of 96, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 42, is a hold recommendation based on Monster Beverage's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Monster Beverage exhibits low value (Obermatt Value Rank of 3), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 51). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 96) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). ...read more
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