Solid First-Quarter Results at Monster Beverage Despite Supply Difficulties; Shares Trade Fairly

Our $82 per share valuation of narrow-moat Beverage should not change significantly in light of its first-quarter earnings, which suggest it can deliver solid results despite ongoing cost pressures from difficult supply conditions. We expect mid-single-digit top-line growth rates and mid-30s adjusted operating margins over the long term. The shares trade near our valuation, and so we suggest prospective investors await a more favorable entry point.