FDA Will Not Take Action On Monster
Shares of US energy drinks company Monster Beverages have received a boost from the news that the Food and Drug Administration (FDA) will not pursue immediate action on energy drinks despite an investigation into health risks associated with the beverages.
Monster , which enjoys a dominant position in fast-growing and lucrative energy drinks market, has been subject to a probe following reports that the deaths of five people dating back to 2004 may have been linked to the consumption of highly caffeinated beverages. Owing to possible regulatory concerns and potential action against energy drinks firms, Monster ' s shares sold off nearly 40% from mid-June to November 27 2012. Following the announcement by the FDA, Monster's shares were up nearly 15% in pre-market trading.
Monster leads the energy drinks market in the US, well ahead of challengers such as Austria ' s Red Bull , which enjoys a dominant position in many other countries. The success of Monster over the past few years, particularly post - 2008 , reflects the strength and bullishness of the wider energy drinks segment over this period, which has generally performed against the tide given the general difficulties faced by the soft drinks industry.
|FDA Probe Hit Shares|
|Monster Beverage Corporation Daily Share Price and 200-Day Simple Moving Average|