EUROPE: Hansen Natural Corp's Monster tipped for share gains

Hansen Natural Corp could see Monster Energy's market share double in Europe within two years, according to US analyst group Stifel Nicolaus.

Stifel Nicolaus analyst Mark Astrachan has forecast that Monster Energy's share of energy drinks sales in Europe, by value, will double to 7.7% in 2012, from 3.4% last year.

Hansen's chairman and CEO, Rodney Sacks, told analysts last month that Monster sales continued to gain momentum in the UK and continental Europe during the first quarter of 2011.

Astrachan said: "We believe Hansen could achieve a 20% share by 2015, approximately 2/3 of its current US share, particularly if share gains accelerate following the four year anniversary of its Europe launch in 2012 as they did in the US."

He added: "We anticipate international will meaningfully contribute to Hansen's operating profit over the next three to five years as the company leverages continued sales growth. Longer-term, we believe the company can achieve a European operating margin of about 20%, compared to a 35% margin in the US."

Stifel lifted its 2011 and 2012 EPS estimates on Hansen to US$2.94 and $3.50, from $2.86 and $3.31 respectively.

In 2010, Europe accounted for 49% of Hansen's net sales, largely due to consumer demand for its flagship Monster Energy drink. Sales beyond the US and Europe accounted for 15% of group net sales for the 12 months.