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Factors to Influence Monster Beverage's (MNST) Q2 Earnings

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Monster Beverage Corporation (MNST - Free Report) is expected to report second-quarter 2022 results on Aug 4, after the closing bell. The beverage company is anticipated to have witnessed revenue growth in the to-be-reported quarter.

The Zacks Consensus Estimate for second-quarter revenues is pegged at $1.62 billion, indicating growth of 10.5% from that reported in the year-ago quarter. The consensus estimate for earnings of 68 cents per share suggests a decline of 9.3% from 75 cents reported in the year-ago quarter. The consensus mark has been unchanged in the past 30 days.

In the last reported quarter, the company posted a negative earnings surprise of 8.3%. It has delivered an earnings surprise of 0.1%, on average, in the trailing four quarters.

Monster Beverage Corporation Price and EPS Surprise

 

Monster Beverage Corporation Price and EPS Surprise

Monster Beverage Corporation price-eps-surprise | Monster Beverage Corporation Quote

Key Factors to Note

Monster Beverage has been gaining from the continued strong demand for energy drinks, and various product launches across domestic and international markets. Management is optimistic about strength in the energy drinks category, with the Monster Energy brand growing significantly. Gains from strong demand for energy drinks are likely to have aided Monster Beverage's top line in the second quarter.

The company is expected to have witnessed momentous growth in e-commerce, club stores, mass merchandiser and grocery-related businesses.

Monster Beverage has been committed to product launches and innovation to boost growth. Management has been optimistic about the significant growth potential of its Monster Energy brand. Product launches across the Monster family are likely to have boosted the company's overall top and bottom lines in the to-be-reported quarter. Additionally, it remains on track to launch a number of products and product lines in the domestic and international markets throughout 2022. This is expected to have boosted revenues in the to-be-reported quarter.

However, higher freight rates and fuel costs, including costs for the import of aluminum cans, and elevated aluminum can costs on higher aluminum commodity pricing, have been resulting in higher cost of sales. This, along with higher cost of secondary packaging materials, increased co-packing fees, production inefficiencies, and geographical sales mix, is likely to have dented margins in the second quarter.

The company’s bottom line is also expected to have been impacted by inflationary operational costs for aluminum cans, shipping, freight and other inputs. It has also been witnessing freight inefficiencies, port congestion, and insufficient co-packing capacity and delays. Elevated distribution expenses also remain concerning. These are likely to have marred the bottom line in the second quarter.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for Monster Beverage this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Monster Beverage has a Zacks Rank #3 and an Earnings ESP of -2.74%.

Stocks Poised to Beat Earnings Estimates

Here are a few companies you may want to consider, as our model shows that these have the right combination to post an earnings beat:

Corteva (CTVA - Free Report) currently has an Earnings ESP of +0.20% and a Zacks Rank #2. CTVA is anticipated to register top and bottom-line growth when it reports second-quarter 2022 results. The Zacks Consensus Estimate for Corteva’s quarterly revenues is pegged at $6.18 billion, indicating an improvement of 9.8% from the figure reported in the prior-year quarter.

You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Corteva’s bottom line has moved up by a penny in the past 30 days to $1.47 per share. The consensus estimate for CTVA suggests growth of 5% from the year-ago quarter’s reported figure. CTVA has delivered an earnings beat of 22.3%, on average, in the trailing four quarters.

Grocery Outlet (GO - Free Report) currently has an Earnings ESP of +3.55% and a Zacks Rank of 2. The company is expected to register top and bottom-line growth when it reports second-quarter 2022 numbers. The Zacks Consensus Estimate for GO’s quarterly revenues is pegged at $859.6 million, which suggests growth of 10.8% from the prior-year quarter’s reported figure.

The Zacks Consensus Estimate for Grocery Outlet’s quarterly earnings has been unchanged in the past 30 days at 24 cents per share, suggesting a 4.4% increase from the year-ago reported number. GO has delivered an earnings beat of 4.8%, on average, in the trailing four quarters.

Kellogg's (K - Free Report) currently has an Earnings ESP of +1.67% and a Zacks Rank #3. K is likely to register top-line growth when it reports the second-quarter 2022 numbers. The Zacks Consensus Estimate for its quarterly revenues is pegged at $3.65 billion, which suggests growth of 2.6% from the figure reported in the prior-year quarter.

The Zacks Consensus Estimate for Kellogg's quarterly earnings has been unchanged in the past 30 days at $1.05 per share, suggesting a decline of 8.9% from the year-ago quarter’s reported number. TSN has delivered an earnings beat of 12.8%, on average, in the trailing four quarters.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.