Can Monster Energy Produce Monster Returns?
By Benjamin Goldman:When it comes to the soft drink industry, there are essentially two major players: Coca-Cola (KO) and PepsiCo (PEP) with Dr. Pepper/Snapple Group (DPS) acting as a distant third. Recently, Monster Beverage Corporation (MNST), also known as Hansen's Natural, has experienced high growth and with a $10.4 billion market cap, has surpassed Dr. Pepper/Snapple in value. In this article, I explain why Monster Beverage shares are doing so well and what it means for the company and the soft drink industry going forward. The soft drink industry is extremely concentrated (no pun intended) because of distribution. Supermarkets want to deal with only a handful of suppliers for a limited number of stock keeping units, and restaurants generally only sell one company's beverages. To have a larger retail footprint and more negotiating leverage, brands tend to buy each other up. Pretty much anybody can make and bottle a beverage, but gettingComplete Story »