MNST
Monster Beverage Corporation
$99.56
Platform & Compounding FCF
65%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 52.7% above fair value
You pay
$99.56
Bear
$45.96
Fair
$65.22
Bull
$85.38
Bear
$45.96
-53.8%
8% stage 1 growth, 11% discount
Fair
$65.22
-34.5%
13% stage 1 growth, 11% discount
Bull
$85.38
-14.2%
16% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (13% base case)
Terminal Value % of EV
41%
Implied Market Multiple
50.5x
Market is pricing in (growth)
21.3%
vs 12.5% base
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $94.50 from 44 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $65.22 per share.
Warnings
Wall Street's average price target is $94.50 (from 44 analysts). Our estimate is 44% below the consensus -- consider that gap carefully.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions