Stock Analysis on Net
Stock Analysis on Net

Monster Beverage Corp. (NASDAQ:MNST)

This company has been moved to the archive! The financial data has not been updated since May 7, 2024.

Common-Size Income Statement

Monster Beverage Corp., common-size consolidated income statement

Microsoft Excel
12 months ended: Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Net sales 100.00 100.00 100.00 100.00 100.00
Cost of sales -46.86 -49.70 -43.90 -40.77 -40.05
Gross profit 53.14% 50.30% 56.10% 59.23% 59.95%
Operating expenses -25.78 -25.19 -23.66 -23.72 -26.56
Operating income 27.36% 25.11% 32.44% 35.51% 33.40%
Interest on finance lease liabilities 0.00 0.00 0.00 0.00 0.00
Other income (expense), net 1.62 -0.20 0.07 -0.15 0.31
Income before provision for income taxes 28.97% 24.91% 32.51% 35.36% 33.71%
Provision for income taxes -6.13 -6.03 -7.65 -4.71 -7.33
Net income 22.84% 18.88% 24.86% 30.65% 26.37%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

The financial performance from 2019 to 2023 reflects a period of margin compression followed by a partial recovery. The most significant fluctuations are observed in the cost of sales and the resulting gross profit margins, which heavily influenced the overall net income trajectory.

Gross Profitability and Cost Management
A steady increase in the cost of sales is evident, rising from 40.05% of net sales in 2019 to a peak of 49.70% in 2022. This trend resulted in a corresponding decline in gross profit, which fell from 59.95% in 2019 to 50.30% in 2022. However, a reversal occurred in 2023, where cost of sales decreased to 46.86% and gross profit improved to 53.14%, indicating a partial mitigation of the cost pressures experienced in previous years.
Operational Expense Trends
Operating expenses remained relatively stable over the five-year period, fluctuating between 23.66% and 26.56% of net sales. A slight reduction in operating expenses was noted between 2019 and 2021, followed by a gradual increase to 25.78% by 2023. The stability of these expenses suggests that the volatility in operating income was primarily driven by gross margin fluctuations rather than shifts in operational overhead.
Operating and Pre-Tax Income
Operating income peaked in 2020 at 35.51% of net sales before experiencing a significant decline to 25.11% in 2022. This contraction mirrors the rise in cost of sales. By 2023, operating income recovered to 27.36%. Other income and expenses had a negligible impact for most of the period, although a notable positive contribution of 1.62% was recorded in 2023, supporting the recovery in income before taxes.
Net Income and Tax Impact
Net income margins exhibited significant volatility, reaching a high of 30.65% in 2020 and a low of 18.88% in 2022. The provision for income taxes varied inconsistently, ranging from 4.71% to 7.65% of net sales, which contributed to the fluctuations in the final bottom line. The net income margin ended the period at 22.84% in 2023, marking an improvement over the 2022 low but remaining below the levels seen in 2019 and 2020.

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