CC Wealth Ltd Follows Monster Beverage Corp Sales Grow Larger Still
CC Wealth Ltd follows perhaps the most attractive takeover target in the beverage industry, Monster Beverage Corp. As the energy drink maker's sales continue to grow.
New York, NY, November 17, 2014 (Newswire.com) - Monster Beverage Corp, the company perpetually at the centre of takeover speculation even as its revenues surge. Despite the growing cost of any purchase of the energy drink maker increasing rapidly, many in the beverage industry seem to be examining the potential cost of not buying the runaway success as sales of traditional carbonated beverages fall at a time that is seeing sales of energy drinks grow.
Sales of energy drinks in the U.S increased 4.8% for the last three months compared to the same period a year ago. Monster is projecting growth in revenues of 12% for 2014, while beverage powerhouse Coca-Cola Co is expected to release figures this month showing a 1.6% reduction in revenues for 2013, the first decline in revenues by the company since 2009. Coca Cola shares U.S distribution rights for Monster’s drinks with Anheuser-Busch InBev NV, yet lacks an energy drink of its own in its lineup.
“The energy drink market is the fastest growing sector in the beverage industry and this is taking place at a time that is seeing declines in the sales of other carbonated beverages such as those offered by Coca Cola. Coke, of course does have the marketing and global presence to move Monster’s products on a massive scale and this would go a long way to offsetting any losses in other areas” stated Peter Weiss, Senior Fund Manager at CC Wealth Ltd.
With some analysts projecting increases in sales by Monster of 53% by 2017 and a current company valuation of $11.3 billion, the prospect of paying premium rates now of up to $90-$95 per share by Coca Cola are not unthinkable as even at this cost the purchase is still a profitable one. Monster’s shares rose 3.4% to $69.82 in trading, the highest since July 2012, and the company has an ROI of 37.12% for the year to date.
“There are still a lot of factors at play here, namely the FDA looking into energy drinks containing caffeine which may put off any buyers until after they report and of course the rates at which traditional beverage sales either continue to decline or just as likely rebound, if viewed on an international level as we must do with Coca Cola’s business” detailed Peter Weiss of CC Wealth Ltd,