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Monster Beverage (MNST) Q4 Earnings: What's in the Cards?
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Monster Beverage Corporation (MNST - Free Report) is expected to release fourth-quarter 2016 financial numbers on Feb 23.
In the last reported quarter, the company posted a negative 10.81% earnings surprise. Also, the company surpassed the Zacks Consensus Estimate in only one of the last four quarters, with an average miss of 6.76%.
Let’s see how things are shaping up prior to this announcement.
Factors at Play
Monster Beverage benefits from strong sales of new products in the U.S. The company's deal with Coca-Cola Company is expected to expand its presence in the international energy drinks market. The trend is expected to continue in the soon-to-be-reported quarter.
Also, the acquisition of American Fruits and Flavors (“AFF”) proved accretive to earnings. As a result of the AFF transaction, the company achieved raw material cost savings of $23.3 million in the third quarter. Monster Beverage is likely to benefit further from the AFF transaction in the fourth quarter as well.
However, Monster Beverage’s sales and profits have been dented significantly by unfavorable currency translations. Though the U.S. dollar has recently softened against other currencies, the impact is still significant.
Also, high professional service costs related to regulatory and litigation issues and transition costs connected to the Coca-Cola deal are denting Monster Beverage’s profits.
Notably, for the fourth quarter, the Zacks Consensus Estimate for earnings is pegged at 35 cents, reflecting a 35.6% year-over-year increase. Meanwhile, our estimate for revenues is pegged at $723.90 million, implying a 12.2% increase.
Earnings Whispers
Our proven model does not conclusively show that Monster is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: Monster has an Earnings ESP of 0.00%. That is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 30 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Monster Beverage Corporation Price and EPS Surprise
Zacks Rank: Monster has a Zacks Rank #4 (Sell). Please note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Mondelez International, Inc. (MDLZ - Free Report) reported fourth-quarter 2016 results, wherein earnings and revenues missed the Zacks Consensus Estimate. The underperformance was mainly due to a stronger dollar that impacted sales outside the U.S.
The Hershey Company’s (HSY - Free Report) fourth-quarter 2016 earnings beat the Zacks Consensus Estimate while sales missed the same. Earnings benefited from higher sales in North America. Hershey’s fourth-quarter adjusted earnings per share of $1.17 also beat the year-ago profit of $1.08 by 8.3%.
J&J Snack Foods Corp. (JJSF - Free Report) , a leading snack food provider, reported first-quarter fiscal 2017 earnings of 72 cents per share, surpassing the Zacks Consensus Estimate of 64 cents by 12.5%.
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Monster Beverage (MNST) Q4 Earnings: What's in the Cards?
Monster Beverage Corporation (MNST - Free Report) is expected to release fourth-quarter 2016 financial numbers on Feb 23.
In the last reported quarter, the company posted a negative 10.81% earnings surprise. Also, the company surpassed the Zacks Consensus Estimate in only one of the last four quarters, with an average miss of 6.76%.
Let’s see how things are shaping up prior to this announcement.
Factors at Play
Monster Beverage benefits from strong sales of new products in the U.S. The company's deal with Coca-Cola Company is expected to expand its presence in the international energy drinks market. The trend is expected to continue in the soon-to-be-reported quarter.
Also, the acquisition of American Fruits and Flavors (“AFF”) proved accretive to earnings. As a result of the AFF transaction, the company achieved raw material cost savings of $23.3 million in the third quarter. Monster Beverage is likely to benefit further from the AFF transaction in the fourth quarter as well.
However, Monster Beverage’s sales and profits have been dented significantly by unfavorable currency translations. Though the U.S. dollar has recently softened against other currencies, the impact is still significant.
Also, high professional service costs related to regulatory and litigation issues and transition costs connected to the Coca-Cola deal are denting Monster Beverage’s profits.
Notably, for the fourth quarter, the Zacks Consensus Estimate for earnings is pegged at 35 cents, reflecting a 35.6% year-over-year increase. Meanwhile, our estimate for revenues is pegged at $723.90 million, implying a 12.2% increase.
Earnings Whispers
Our proven model does not conclusively show that Monster is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: Monster has an Earnings ESP of 0.00%. That is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 30 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Monster Beverage Corporation Price and EPS Surprise
Monster Beverage Corporation Price and EPS Surprise | Monster Beverage Corporation Quote
Zacks Rank: Monster has a Zacks Rank #4 (Sell). Please note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
You can see the complete list of today’s Zacks #1 Rank(Strong Buy) stocks here.
Peer Releases
Mondelez International, Inc. (MDLZ - Free Report) reported fourth-quarter 2016 results, wherein earnings and revenues missed the Zacks Consensus Estimate. The underperformance was mainly due to a stronger dollar that impacted sales outside the U.S.
The Hershey Company’s (HSY - Free Report) fourth-quarter 2016 earnings beat the Zacks Consensus Estimate while sales missed the same. Earnings benefited from higher sales in North America. Hershey’s fourth-quarter adjusted earnings per share of $1.17 also beat the year-ago profit of $1.08 by 8.3%.
J&J Snack Foods Corp. (JJSF - Free Report) , a leading snack food provider, reported first-quarter fiscal 2017 earnings of 72 cents per share, surpassing the Zacks Consensus Estimate of 64 cents by 12.5%.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>