Will Monster Beverage Corp (MNST) Have a Monster Year in 2013?

What the future holds
Investors should instead be focused on the other opportunities and challenges facing Monster Beverage in the year ahead. International growth, for example, will play a key role in the company’s performance during fiscal 2013. In 2011, only 20% of the company’s gross sales were generated outside of the United States. However, international sales should increase as Monster Beverage continues to expand its distribution in emerging markets.

On the risk side of things, Monster Beverage faces considerable competition in the energy-drinks space. Companies with deep pockets including Starbucks Corporation (NASDAQ:SBUX) and Jamba Juice have recently pushed into the market with more natural energy alternatives.

Last year, Starbucks launched its line of energy drinks known as Starbucks Refreshers. Unlike Monster Beverage’s drinks, which were recently under investigation for heath concerns related to ingredients such as taurine, Starbucks Refreshers are made from real fruit juice and green coffee extract.

More recently, Pepsi launched a healthier caffeinated beverage that it calls Kickstart. While the soft drink maker refuses to call the new product an “energy drink,” it is certainly being advertised as one. Pepsi’s new beverage reportedly tastes like the company’s Mountain Dew soda; only it’s made with 5% juice, vitamins B and C, and added caffeine for that extra kick.

The energy drink market is certainly getting crowded these days as companies rush to cash in on the industry’s fastest-growing segment. Despite the added risk this brings, I’m confident in Monster Beverage’s strong position within the market. A deal with Coke may not be on the horizon just yet. However, the company reports fiscal 2012 fourth-quarter earnings on Feb. 27, which should give investors added insight into the year ahead.

The article Will This Stock Have a Monster Year in 2013? originally appeared on Fool.com and is written by Tamara Rutter.

Fool contributor Tamara Rutter has no position in any stocks mentioned. The Motley Fool recommends Coca-Cola, Monster Beverage, PepsiCo, and Starbucks. The Motley Fool owns shares of Monster Beverage, PepsiCo, and Starbucks.

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