Monster Beverage (MNST) rises on double-digit revenue growth in Q4, strong gross margin

Monster Beverage Corporation (NASDAQ: MNST) shares jumped over 5% in after-hours trading Wednesday after the energy drink maker reported notably better-than-expected gross profit margins and strong revenue growth for the fiscal fourth quarter.

Earnings per share (EPS) were reported at $0.38, in line with consensus expectations. Revenue saw a record year-over-year rise of 14.4% to $1.73 billion, though still below the anticipated $1.76 billion.

The gross profit margin for the quarter stood at 54.5%, excluding the Bang inventory step-up, surpassing the market's forecast by approximately 90 basis points.

On the expense front, Monster Beverage saw a significant increase in operating expenses, which rose to $504.4 million in the fourth quarter of 2023 from $390.0 million in the same period the previous year.

“Resilient top-line growth and better-than-expected gross margins make us feel positive about the underlying health of the business,” Bernstein analysts led by Callum Elliot said in a note.

“However, there is also an unexpected step-up in operating costs that merits some attention,” they added.

Still, the evident strength in revenue growth and robust gross margins “paints a positive picture of the health of the business into 2024, in our view.”

By Vahid Karaahmetovic

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