Shares of Monster Beverage Corporation (MNST - Free Report) rallied more than 14% in afterhours trading on Mar 1, as the energy drink company’s fourth-quarter numbers exceeded expectations even after facing $46.3 million in distribution termination fees.
Monster Beverage’s fourth-quarter adjusted earnings of 35 cents per share beat the Zacks Consensus Estimate of 30 cents by 16.7%. Earnings also increased 59.1% year over year on higher sales.
Full-year 2016 earnings came in at $1.19, up from the year-ago profit level of 95 cents per share. The reported figure, however, missed the Zacks Consensus Estimate of $1.23.
Sales Detail
Net sales of $753.8 million surpassed the Zacks Consensus Estimate of $724 million by 4.1%. The figure improved 16.8% year over year.
Full-year 2016 net sales were $3 billion, which missed the analysts’ expectation of $3.02 billion. However, the reported figure grew 12% year over year.
Foreign currency had an unfavorable impact of $3.3 million on quarterly net sales and $22.3 million on 2016 net sales.
Net sales outside the U.S. rose 33.2% to $193.5 million in the quarter on a year-over-year basis.
Quarterly Segment Details
Monster Energy Drinks Segment: Net sales at the segment, comprising Monster Energy drinks as well as Mutant Super Soda drinks, were $684.4 million, up 17% year over year.
Strategic Brands segment: This segment includes brands acquired from Coca-Cola. Net sales at the segment increased 6.9% to $64.5 million in the fourth quarter of 2016, compared with $60.4 million in the comparable quarter of 2015.
Other: Net sales for the company's Other segment, which includes some products of American Fruits & Flavors sold to independent third parties, were $4.7 million in the quarter under review. Notably, the segment had reported no net sales in the prior-year quarter.
Margins
Fourth-quarter 2016 gross margin rose 360 basis points (bps) to 66.1%. Operating expenses rose 40.9% year over year to $246.4 million. Operating income in the quarter was $251.7 million, compared with $228.4 million in the prior-year quarter.
Financials
Monster Beverage ended the quarter with cash and cash equivalent of $377.6 million as of Dec 31, 2016, compared with $2.17 billion as of Dec 31, 2015.
Monster Beverage carries a Zacks Rank #4 (Sell).
Stocks to Consider
Some better-ranked stocks in this industry include Post Embotelladora Andina S.A. (AKO.B - Free Report) , Coca-Cola Amatil Limited and Primo Water Corporation (PRMW - Free Report) , all with a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Embotelladora is expected to witness 18.5% earnings growth in the fourth quarter of 2016.
Coca-Cola Amatil is likely to see a 10.8% rise in 2016 earnings.
Primo Water has a solid earnings surprise history, having an average positive surprise of 170%.
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Shares of Monster Beverage Corporation (MNST - Free Report) rallied more than 14% in afterhours trading on Mar 1, as the energy drink company’s fourth-quarter numbers exceeded expectations even after facing $46.3 million in distribution termination fees.
Monster Beverage’s fourth-quarter adjusted earnings of 35 cents per share beat the Zacks Consensus Estimate of 30 cents by 16.7%. Earnings also increased 59.1% year over year on higher sales.
Full-year 2016 earnings came in at $1.19, up from the year-ago profit level of 95 cents per share. The reported figure, however, missed the Zacks Consensus Estimate of $1.23.
Sales Detail
Net sales of $753.8 million surpassed the Zacks Consensus Estimate of $724 million by 4.1%. The figure improved 16.8% year over year.
Full-year 2016 net sales were $3 billion, which missed the analysts’ expectation of $3.02 billion. However, the reported figure grew 12% year over year.
Foreign currency had an unfavorable impact of $3.3 million on quarterly net sales and $22.3 million on 2016 net sales.
Net sales outside the U.S. rose 33.2% to $193.5 million in the quarter on a year-over-year basis.
Quarterly Segment Details
Monster Energy Drinks Segment: Net sales at the segment, comprising Monster Energy drinks as well as Mutant Super Soda drinks, were $684.4 million, up 17% year over year.
Strategic Brands segment: This segment includes brands acquired from Coca-Cola. Net sales at the segment increased 6.9% to $64.5 million in the fourth quarter of 2016, compared with $60.4 million in the comparable quarter of 2015.
Other: Net sales for the company's Other segment, which includes some products of American Fruits & Flavors sold to independent third parties, were $4.7 million in the quarter under review. Notably, the segment had reported no net sales in the prior-year quarter.
Margins
Fourth-quarter 2016 gross margin rose 360 basis points (bps) to 66.1%. Operating expenses rose 40.9% year over year to $246.4 million. Operating income in the quarter was $251.7 million, compared with $228.4 million in the prior-year quarter.
Financials
Monster Beverage ended the quarter with cash and cash equivalent of $377.6 million as of Dec 31, 2016, compared with $2.17 billion as of Dec 31, 2015.
Monster Beverage carries a Zacks Rank #4 (Sell).
Stocks to Consider
Some better-ranked stocks in this industry include Post Embotelladora Andina S.A. (AKO.B - Free Report) , Coca-Cola Amatil Limited and Primo Water Corporation (PRMW - Free Report) , all with a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Embotelladora is expected to witness 18.5% earnings growth in the fourth quarter of 2016.
Coca-Cola Amatil is likely to see a 10.8% rise in 2016 earnings.
Primo Water has a solid earnings surprise history, having an average positive surprise of 170%.
The Best Place to Start Your Stock Search
Today, you are invited to download the full list of 220 Zacks Rank #1 ""Strong Buy"" stocks – absolutely free of charge. Since 1988, Zacks Rank #1 stocks have nearly tripled the market, with average gains of +26% per year. Plus, you can access the list of portfolio-killing Zacks Rank #5 ""Strong Sells"" and other private research. See these stocks free >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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