Monster Beverage Surges On Better-Than-Expected Q1, Tender Offer
Shares of Monster Beverage (MNST) surged in late morning trading after the company reported better-than-expected quarterly earnings and after it announced its intention to commence a new tender offer.
EARNINGS BEAT: Before the market open, Monster Beverage reported earnings per share, excluding special items, of 80c, beating analyst estimates of 74c. Total sales for the quarter amounted to $680.2M, an 8.5% year-over-year increase and higher than analyst expectations of $656.81M.
TENDER OFFER: In addition, Monster Beverage announced that it plans to commence a tender offer in May to purchase up to $2B in value of its common stock through a modified "Dutch auction" tender offer. The company said that a price range for the offer has yet to be specified and added that it will fund the tender offer with cash on hand.
WHAT'S NOTABLE: Several of Monster's sector peers have also recently reported earnings beats, most notably PepsiCo, (PEP) which reported Q1 core EPS of 89c on revenue of $11.86B on April 18, compared with analyst estimates of 81c and $11.88B, respectively. Earlier this week, Dr Pepper Snapple Group (DPS) reported Q1 core EPS of 94c on revenue of $1.49B, higher than analyst expectations of 86c and $1.47B. Coca-Cola's (KO) quarterly results, on the other hand, were mostly in-line with expectations, with the company reporting Q1 comparable EPS of 45c on revenue of $10.28B on April 20. Analysts expected the beverage giant to report comparable EPS of 44c on revenue of $10.29B.
PRICE ACTION: In late morning trading, Monster Beverage jumped 11.6% to $142.66.
OTHERS TO WATCH: Coca-Cola rose 0.15%, Dr Pepper Snapple was marginally higher, and PepsiCo fell marginally.
Disclosure: None.