David Stahl
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Goldman Sees Huge Upside for Monster in China

Goldman Sachs recommended investors buy on any weakness in shares of Monster Beverage Corporation , which is set to report its first quarter numbers on April 29.

Analyst Judy Hong, who cut first quarter EPS view by $0.02 to $0.71 (lower than consensus estimate of $0.74), expects acceleration in sales growth and "still sees healthy 30%/22%/18% EPS growth from 2016E-2018E."

While looking for a "choppy" first quarter results, the analyst said recent category trends have softened a bit despite a "stable" U.S. business.

On the international front, Hong noted Monster faces lingering bottler transition disruptions, while The Coca-Cola Co KO's legacy brands are still weak.

However, Hong added that the company has a "smoother sailing ahead," with much of the transition disruptions abating and company entering in to new markets such as China and Nigeria. The analyst projects China to contribute $50 million in 2016.

"Execution of the $2bn announced buyback could also provide support, and COGS savings from the AFF acquisition should add to EPS," Hong added.

Hong has a Buy rating and $160 price target on Monster, which rose 1.6 percent to $124.93 on Monday.