What happened

Shares of Monster Beverage (NASDAQ:MNST) rose 13.2% in July, according to data provided by S&P Global Market Intelligence.

The energy drink company's stock price has climbed by 23.2% this year and has been achieving new record highs along the way.

Man drinking red energy drink while standing beside bridge

Image source: Getty Images.

So what

Monster has not experienced any material adverse impact from the COVID-19 pandemic thus far. Due to lockdowns and the decrease in foot traffic in the convenience and gas channel, the company saw an increase in in-home consumption of its beverages rather than immediate consumption. Thus far, only April sales have been adversely impacted, but bottlers and distributors have still been able to distribute Monster's products without delays. 

Investors are probably encouraged by the fact that Monster's business can continue to grow amid the pandemic. As more and more people work and study from home, consumption of energy drinks should also rise as these drinks provide a boost to help people concentrate.

Now what

Monster released its second-quarter 2020 earnings this week, and as expected, net sales dipped by around 1% year over year to $1.1 billion. Net income, however, posted a surprising rise of 6.5% year over year to hit $311.4 million. Management's first-quarter guidance was accurate in that sales did plunge in April, but May and June saw an improvement due to an ease in lockdowns around the world. 

CEO Rodney Sacks expressed satisfaction with Monster's first-half performance, and the company is planning for future launches of its Reign Total Body Fuel high-performance energy drinks as well as its affordable energy drink brands outside the U.S. These initiatives, along with new additions to the Monster Energy portfolio, are expected to continue to buoy sales moving forward.

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