Global Courant 2023-04-27 16:00:11
Founded by two South Africans, Monster Beverage Corporation was the best performing US stock in the past 20 years, turning an investment from R1,000 in 2003 to R3.1 million by 2023.
Monster was created by Rodney Sacks and Hilton Schlosberg, who studied at the University of the Witwatersrand (Wits). They emigrated to the US and joined forces to acquire Hansen Natural Corporation for $1.71 million.
Hansen Natural Corporation dates back to the 1930s when Hubert Hansen and his sons began selling juice to retailers under the company name “Hansen’s Fruit and Vegetable Juices”.
In the 1970s, Hubert Hansen’s grandson also started developing soft drinks under the Hansen name. However, the company began to struggle and suffered huge losses in the late 1980s.
This prompted Sacks and Schlosberg to step in and take over and save the beverage company. Following the acquisition, Sacks served as chairman and CEO of Hansen Natural Corporation, while Schlosberg served as president and COO.
Rodney Sacks (center) and Hilton Schlosberg (right)
Their big break came in 2002 when they launched Monster Energy. Within ten years, they increased sales to $2 billion. Monster Energy was so successful that Hansen Natural Corporation changed its name to Monster Beverage Corporation in 2012.
The Coca-Cola Company purchased a 16.7% stake in Monster for $2.15 billion in 2015. This stake has since grown to 19.3% as a result of Monster’s share repurchase.
Today, the company has numerous top brands, including Monster Energy, Burn, NOS, Full Throttle, Relentless, Mother, Reign, and Predator.
In February 2022, it added several craft beers and hard seltzers to its product portfolio by acquiring CANarchy Craft Brewery Collective. What sets Monster Beverage Corporation apart from its energy drinks is its stellar financial performance.
Monster drinks are sold in 141 countries and the company has a significant share of the $53 billion global energy drink market. Over the past 20 years, Monster has been the best performing US stock, with a compound annual return of 42%.
Investors will have received an annualized compounded return of 49.5% if you factor in the depreciation of the rand. Put another way, an investment of R1,000 in the company 20 years ago would have grown to R3,115,732 today.
The graph below shows the growth of an investment of R1,000 between 2003 and 2023.
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