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How Monster Beverage Stock Has Fared Through the Coronavirus Pandemic

By Demitri Kalogeropoulos – Aug 21, 2020 at 9:15AM

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Sales trends have held up well thanks to booming demand at retailers.

What happened

Monster Beverage (MNST -1.38%) stock has trounced the market in the wake of the COVID-19 pandemic, with shares up 32% in 2020 through mid-August. The wider market is up by 5%, in contrast, and major beverage giants such as Coca-Cola and PepsiCo are trailing even that modest result.

So what

The energy drink specialist is enjoying much stronger results than those peers despite market disruptions from COVID-19. Sales were roughly even in the three months ended on June 30, indicating steady volume even as consumption shifted away from on-the-go channels and toward home use of its products.

A woman enjoys a carbonated beverage.

Image source: Getty Images.

Monster Beverage even managed slightly higher profitability thanks to higher pricing and decreased expenses. Coke and PepsiCo each noted double-digit volume declines and reduced earnings for the comparable period.

Now what

In a conference call with investors, CEO Rodney C. Sacks and his team said sales gains came roaring back in July, with case volumes rising 17% after accounting for foreign currency shifts. Executives were careful to note that one monthly sales result isn't necessarily indicative of wider growth trends, and that many risks remain around COVID-19's recessionary impact through 2020. Thus, investors will have to wait for future earnings reports to confirm that Monster Beverage has returned to sustainable growth.

Demitri Kalogeropoulos has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Monster Beverage. The Motley Fool has a disclosure policy.

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Monster Beverage Corporation
$90.47 (-1.38%) $-1.27

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