January 22, 2013
In the following video, Jeremy Bowman and Isaac Pino discuss three reasons investors should sell or avoid Monster Beverage.
First is the fallout from deaths reportedly associated with drinking Monster energy drinks. The FDA has opened an inquiry, and the outcome is unpredictable. How the company responds to the investigation and negative press will affect its image and appeal.
Second, recent earnings growth has slowed and the stock price has declined. For years, Monster was on a tear; now it's looking more like a mature company in a maturing market. Past growth may be difficult to sustain in the future.
Finally, Monster, for all its success, is still a young company. Stability is not yet an asset. The company has experienced difficulty growing outside its original energy-drink market. The transition to a mature company competing with strong, well-established competitors may be problematic.
The stakes are high for Monster Beverage these days. The stock had been nothing short of a rocket, but recent developments have sent shares spiraling downward. Health scares sparked a number of investigations at the state and federal level into the energy drink's role in several fatalities. With the company's value slashed in half, investors are wondering whether Monster Beverage is a value or a bust in the fast-growing energy drink category. Find out now in our brand-new premium research report, which details all the ins and outs you need to know about Monster Beverage and even comes with a full year of updates to boot. Click here now to claim your copy and start reading today.