Monster Beverage Drops On Stifel Concerns

Shares of Monster Beverage MNST fell more than three percent Tuesday morning on comments from Stifel, following the shareholder meeting.

Stifel reduced its estimates on weaker-than-expected sales growth for the past several months. Analyst Mark Astrachan backed up his claims with Monster’s weaker-than-expected April sales and difficulty launching new products.

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Stifel cuts its second quarter sales estimate from 12.2 percent year-over-year growth to 9.9 percent. The earnings reduction on this drop is from $0.76 to $0.74. However, Astrachan did state, “We continue to anticipate at least high single-digit sales growth for Monster over the next 3-5 years driven by U.S. share gains, continued international expansion, and innovation.
Superior growth to the large majority of consumer staples peers justifies the company’s premium valuation, in our view.”

Stifel currently has a Buy rating and $78 price target on Monster. This figure was derived with a 24.7 times forward EPS multiple.

Shares of Apple were last trading at $67.63, down 1.99 percent for the day.