Piper Sandler has reaffirmed its Overweight rating on shares of Celsius Holdings (NASDAQ: NASDAQ:CELH), with a consistent price target of $47.00.
The firm's position follows insights from a comprehensive Teen Survey, which sampled approximately 13,500 teens.
The survey revealed that Celsius Holdings continues to outperform in the energy drink category among the teen demographic.
Celsius Holdings is gaining traction with teens, capturing about 15% of mentions as a favorite brand, surpassing its general market share of approximately 11.5%.
This indicates that the brand is about 35% more popular among teens than in the broader market. The survey suggests that Celsius is expanding its appeal and market presence within this key demographic.
In contrast, Red Bull appears to be losing ground among teens. While Red Bull still holds about 25% of mentions as a favorite among teens, this is significantly lower than its overall market share, which stands at roughly 38%. The data suggests that Red Bull could be ceding market share over time, as its popularity with teens does not match its dominance in the overall market.
The survey also touched on Monster Beverage Corporation (NASDAQ:MNST), noting that it slightly lags behind in the teen market. The company's share of mentions as a favorite brand among teens is just behind its overall market share level. This indicates that, while Monster is not as over-indexed as Celsius among teens, it is maintaining a relatively stable position in the market.
In other recent news, Monster Beverage Corporation has initiated a $500 million stock buyback program. This decision comes after the completion of the company's previous repurchase program. The repurchase process will depend on various market conditions and could be suspended or discontinued at any time.
In the company's second quarter earnings report, Monster Beverage reported a moderate increase in net sales, hitting a record $1.9 billion, a 2.5% increase from the previous year. This growth occurred despite challenges in the U.S. energy drink market. The company also announced a 5% price increase on core brands and packages in the United States, set to take effect on November 1, 2024.
Roth/MKM adjusted its outlook on Monster Beverage, reducing the price target from $56.00 to $50.00, while maintaining a neutral rating. The revision was influenced by the company's second quarter performance, which fell short of expectations in terms of revenue and Adjusted EBITDA.
InvestingPro Insights
To complement the insights from Piper Sandler's Teen Survey, recent data from InvestingPro provides additional context on Monster Beverage Corporation's (NASDAQ:MNST) financial position. Despite the survey indicating that Monster slightly lags in the teen market, the company maintains a strong financial foundation. With a market capitalization of $48.77 billion, Monster Beverage demonstrates its significant presence in the energy drink industry.
InvestingPro data reveals that Monster's revenue growth stands at 10.38% over the last twelve months as of Q2 2024, reflecting the company's ability to expand its market share despite fierce competition. The company's gross profit margin of 53.73% for the same period indicates efficient cost management and pricing power.
InvestingPro Tips highlight that Monster Beverage holds more cash than debt on its balance sheet, suggesting financial stability and flexibility to invest in marketing and product development to appeal to younger consumers. Additionally, the company's management has been aggressively buying back shares, which could signal confidence in the company's future prospects.
For investors seeking a more comprehensive analysis, InvestingPro offers 11 additional tips for Monster Beverage Corporation, providing a deeper understanding of the company's financial health and market position.
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