Is Monster Beverage Corp (MNST) overvalued?
On Equity Rank's model estimate, MNST trades 100% above its fair value. Monster Beverage Corp (MNST) last closed at $45.72; the multi-method model fair value is $22.91.
| Price | Model fair value | Price vs model |
|---|---|---|
| $45.72 | $22.91 | 100% above |
What the answer rests on
- 0 of 8 valuation methods put MNST's value above its price and 8 put it below, so the methods mostly agree.
- To justify today's price, MNST's free cash flow would need to grow about 13.6% a year for ten years (a reverse discounted cash flow). Over the last three years it actually grew 42.8% a year.
- MNST trades at 45.1 times its last year's earnings, against a median of 20.3 for 19 profitable Beverages companies.
- Over the past year the price sat below the model fair value on 0% of trading days. The gap ranged from 0% above to 125% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind MNST's fair value · What prices assume · Other companies