Does Monster Stock Still Have Room to Grow After 29% Surge in 2025?

Thinking about what to do next with Monster Beverage stock? You are definitely not alone. Over the past month, shares have climbed an impressive 6.4%, adding to a trend that has seen the stock jump more than 29% so far this year. Even looking further back, Monster Beverage has steadily delighted long-term holders with returns of 32.6% in the past year and a striking 67% over the last five years. That represents quite the ride for anyone who stuck with it.

Market watchers have noted that this steady upward march seems fueled by growing demand for energy drinks and evolving consumer trends, both of which continue to benefit Monster Beverage. Investors clearly have not been put off by shifting risk perceptions or competitive pressures, judging by the consistently positive returns across all major time frames.

But while those stock gains look exciting, what really matters now is whether Monster still has room to run, or if the price has gotten ahead of itself. That is where valuation comes in. Using a range of approaches, Monster Beverage’s current value score comes in at 0 out of a possible 6, meaning the company is not undervalued according to any of the traditional checks we apply here. So what does that mean for you? In the next section, we will walk through these valuation approaches. Stick around until the end, because there might be a smarter way to figure out what this stock is truly worth.

Monster Beverage scores just 0/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Monster Beverage Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model estimates a company's intrinsic value by forecasting its future cash flows and discounting them back to today's dollars. For Monster Beverage, the model begins with the company's current annual Free Cash Flow, which sits at $1.8 billion. Analysts project steady growth in these cash flows, with forecasts reaching $2.29 billion by 2029. Beyond the first five years, further projections are calculated using standard long-term growth assumptions.

All cash flows here are presented in US dollars. The DCF methodology provides a detailed and bottom-up look at how Monster Beverage's business might expand over the next decade, relying partly on analyst predictions and then extending with careful extrapolation. According to this approach, the estimated fair value for Monster Beverage stock is $61.01 per share.

When compared to its recent share price, the DCF model suggests Monster is trading at a 10.8% premium to its intrinsic value. This means the stock appears overvalued based on expected future cash flows. This overvaluation signals that much of the company's growth may already be priced in.

Result: OVERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Monster Beverage.

Our Discounted Cash Flow (DCF) analysis suggests Monster Beverage may be overvalued by 10.8%. Find undervalued stocks or create your own screener to find better value opportunities.

Approach 2: Monster Beverage Price vs Earnings

For profitable companies like Monster Beverage, the Price-to-Earnings (PE) ratio is one of the most straightforward ways to gauge valuation. This metric helps investors compare what they are paying for $1 of a company’s earnings. It is especially useful when profits are reliable and growing.

It is important to note that a “normal” or “fair” PE ratio depends on a company’s growth prospects and risk profile. Higher growth usually justifies a higher PE, while more risk or slower growth should result in a lower PE.

Monster Beverage currently trades at a PE ratio of 41.94x. This is well above both the average for the beverage industry at 17.70x and its closest peer group at 21.36x. At first glance, this high multiple might suggest Monster is expensive based purely on nearby comparisons.

However, Simply Wall St’s “Fair Ratio” provides a more nuanced benchmark. The Fair Ratio for Monster Beverage is 24.81x, reflecting not only industry comparisons but also factors such as Monster’s faster-than-average earnings growth, high margins, unique risks, and its scale in the market. Unlike a simple peer or industry comparison, this approach adjusts for what really drives the company’s earnings power and potential.

Monster Beverage’s actual PE ratio, at 41.94x, is significantly higher than its Fair Ratio of 24.81x. This indicates the stock is overvalued by this measure as well.

Result: OVERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Monster Beverage Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let's introduce you to Narratives. A Narrative is a concise story or perspective you apply to a company, connecting your assumptions about Monster Beverage’s future (like its international growth or product innovation) directly to forecasts for revenue, earnings, margins, and ultimately to a fair value. This approach goes beyond just the numbers by letting you spell out why you think a business will succeed or face challenges, bringing your investment thesis to life.

Narratives link the company’s story to a financial forecast and then to a fair value, making it easy to visualize where your expectations sit compared to the market. With Simply Wall St’s platform, Narratives are easy to create and compare, and are available to all investors on the Community page, which is used by millions worldwide. Narratives help investors quickly decide when to buy or sell by comparing their own fair value to the current share price, and they update automatically as new information comes in, so your view stays current.

For example, some Monster Beverage investors are most optimistic, setting fair value targets around $75.00 based on bullish expectations for international growth and premium product expansion, while others are more cautious, with bearish targets near $50.00, citing potential margin pressure from cost and regulatory risks. Narratives make these differences visible, allowing you to sense-check your view against a dynamic range of community perspectives.

Do you think there's more to the story for Monster Beverage? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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