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Monster Beverage's Partnership With Coca-Cola Will Expand Its Global Reach

Summary

Monster Beverage’s ability to innovate and market its drinks leads to strong revenue and earnings growth.

Monster’s strategic partnership with Coca-Cola will help catalyze growth.

I expect Monster’s stock to continue to outperform as a result of continued above average earnings growth.

image source: wsj.com

I continue to look for companies with strong sustainable growth which can catalyze strong stock gains over the long-term. Monster Beverage (NASDAQ:MNST) has above average top line and bottom line growth, which will drive the stock price to outperform the S&P 500. Monster looks good going forward as the company expands its product line and increases its distribution with the Coca-Cola Company (NYSE:KO) partnership.

Monster Beverage does a great job of innovating and marketing its line of energy drinks. The company has a hip, macho image with its standard black can with the florescent green logo. Of course people buy the drinks for the caffeine-fueled energy kick that they provide while looking cool drinking it.

Monster is more than just the standard Monster Energy black can product. The company has 36 different drinks in its product line. Monster does a good job of creating new drinks to appeal to more consumers. For example, the Zero Ultra drink in the white can appeals to consumers who want an energy drink without the calories and sugar. Another example is the Unleaded drink, which contains an energy blend, but appeals to consumers who don't want caffeine.

I'm an Eagles fan and hate to admit that the Patriots' success led to the company's Gronk drink, named after the clutch tight end, Rob Gronkowski. However, the Gronk drink is a good example of Monster's marketing efforts. It's not that the drink has a different energy formula, only a different flavor. The Gronk drink gives Monster more of a sporty look with a picture of Gronkowski on the can, which can appeal to Patriots fans.

More examples of the expanding product line include: coffee in a can with its Java Monster drinks, teas in various flavors under the Monster Rehab name, and protein packed drinks for body builders. All of these added drink formulas appeal to additional consumers with specific tastes. Of course, the various new drinks are likely to appeal to many of Monster's current customers since they are already familiar with the...


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