Market's view on Fevertree
Published on April 2024
- US sales are performing strongly according to Nielsen, significantly outpacing category competition.
- There is an indication of an inventory unwind signal from a related industry player, suggesting possible implications for broader market behaviour.
- Queries are raised about the reasons behind a sudden rise in stock value.
- Comparisons are made with Monster Beverage Corporation as a benchmark for performance assessment.
- It is noted that the company’s revenue multiple for acquisition is not considered high, at 3.8 years.
- There is optimism from management about doubling profits and improving margins.
- The company is actively promoting its joint venture in Japan with Asahi.
- Discussions centre around the total addressable market (TAM), particularly highlighting the U.S. market’s size compared to the UK.
- There are concerns about the company’s distribution and sales operations, with reports of poor supply chain performance despite high market expectations.
- Financial forecasts suggest an improvement, but operational challenges, such as stock shortages, are causing frustration.
- The company’s revenue meets analyst consensus, but there are discrepancies between company statements and actual financial performance.
- A notable increase in product price is mentioned, along with reliance on growing U.S. revenues to offset declines in the UK and Rest of World (ROW) markets.
- The stock is considered to be in overbought territory, suggesting a potential pullback.