Primo Brands (NYSE:PRMB) vs. Monster Beverage (NASDAQ:MNST) Critical Comparison

Primo Brands (NYSE:PRMB) and Monster Beverage (NASDAQ:MNST) are both large-cap consumer staples companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, institutional ownership, dividends, valuation, analyst recommendations, profitability and risk.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Primo Brands and Monster Beverage, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Primo Brands	0	0	3	0	3.00
Monster Beverage	2	7	12	0	2.48

Primo Brands presently has a consensus target price of $37.00, suggesting a potential upside of 12.91%. Monster Beverage has a consensus target price of $55.47, suggesting a potential upside of 12.25%. Given Primo Brands’ stronger consensus rating and higher possible upside, equities analysts clearly believe Primo Brands is more favorable than Monster Beverage.

Earnings & Valuation

This table compares Primo Brands and Monster Beverage”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Primo Brands	$1.77 billion	7.02	$238.10 million	$1.61	20.35
Monster Beverage	$7.41 billion	6.49	$1.63 billion	$1.56	31.68

Monster Beverage has higher revenue and earnings than Primo Brands. Primo Brands is trading at a lower price-to-earnings ratio than Monster Beverage, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

87.7% of Primo Brands shares are held by institutional investors. Comparatively, 72.4% of Monster Beverage shares are held by institutional investors. 2.5% of Primo Brands shares are held by company insiders. Comparatively, 7.8% of Monster Beverage shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Volatility & Risk

Primo Brands has a beta of 1.09, suggesting that its share price is 9% more volatile than the S&P 500. Comparatively, Monster Beverage has a beta of 0.74, suggesting that its share price is 26% less volatile than the S&P 500.

Profitability

This table compares Primo Brands and Monster Beverage’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Primo Brands	13.63%	8.80%	3.62%
Monster Beverage	21.66%	23.31%	18.48%

Summary

Monster Beverage beats Primo Brands on 8 of the 14 factors compared between the two stocks.

About Primo Brands

Primo Water Corporation is a leading pure-play water solutions provider in North America and Europe. Primo operates largely under a recurring razor/razorblade revenue model. The razor in Primo’s revenue model is its industry leading line-up of sleek and innovative water dispensers, which are sold through major retailers and online at various price points or leased to customers. The dispensers help increase household penetration, which drives recurring purchases of Primo’s razorblade offering. Primo’s razorblade offering is comprised of Water Direct, Water Exchange, and Water Refill. Primo’s water solutions expand consumer access to purified, spring and mineral water to promote a healthier, more sustainable lifestyle while simultaneously reducing plastic waste and pollution. Primo is committed to its water stewardship standards and is proud to partner with the International Bottled Water Association in North America as well as with Watercoolers Europe.

About Monster Beverage

Monster Beverage Corporation, through its subsidiaries, engages in development, marketing, sale, and distribution of energy drink beverages and concentrates in the United States and internationally. The company operates through three segments: Monster Energy Drinks, Strategic Brands, Alcohol Brands, and Other. It offers carbonated non-carbonated energy drinks, ready-to-drink iced teas, lemonades, juice cocktails, single-serve juices and fruit beverages, ready-to-drink dairy and coffee drinks, energy drinks, sports drinks and single-serve still waters, and sodas that are considered natural, sparkling juices, and flavored sparkling beverages. The company sells its products to full service beverage bottlers/distributors, retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience chains, food service customers, value stores, e-commerce retailers, and the military; and concentrates and/or beverage bases to authorized bottling and canning operations. It provides its products under the Monster Energy, Monster Energy Ultra, Monster Rehab, Monster Energy Nitro, Java Monster, Punch Monster, Juice Monster, Muscle Monster, Espresso Monster, Monster Tour Water, Fury, Monster MAXX, Caffe Monster, Monster Hydro, Monster HydroSport Super Fuel, Monster Dragon Tea, Reign Total Body Fuel, and Reign Inferno Thermogenic Fuel, Reign Storm, Bang Energy, NOS, Full Throttle, Burn, Mother, Nalu, Ultra Energy, Play and Power Play (stylized), Relentless, BPM, BU, Gladiator, Samurai, Live+, Predator, and Fury brands. The company was formerly known as Hansen Natural Corporation and changed its name to Monster Beverage Corporation in January 2012. Monster Beverage Corporation was founded in 1985 and is headquartered in Corona, California.