With the recent release of Death Stranding, some are speculating that Monster Energy stock got a major bump in price from the launch of the game. While it’s entirely possible that the Death Stranding brand deal with Kojima Productions contributed to its gains, the real explanation is much simpler.
The image below shows that Monster Energy stock jumped from $55.99 on Wednesday, November 6, 2019, up to $58.16 on market’s close on Friday, November 8, 2019. The price subsequently slid to $58.03 on the following day. Clearly there was a gain over the last few days, but was it because of Death Stranding? Probably not.
ALSO: Hideo Kojima: Death Stranding reviews are mixed because it’s ‘difficult to understand’
As Niko Partners Senior Analyst Daniel Ahmad points out on Twitter, the November 8 release of Death Stranding did indeed coincide with the price bump of the energy drink’s stock price. However, something much more important also took place on this day: the company released its third-quarter earnings report.
Nov 8th: Death Stranding releases with Monster Energy drink product placements
Nov 8th: Monster Beverage stock increases sharply
Coincidence???? (Technically it was as the company released positive Q3 earnings the day prior and the increase was a reaction to that). pic.twitter.com/idX6iFzunr
— Daniel Ahmad (@ZhugeEX) November 12, 2019
Yahoo! Finance reports that Monster Energy’s net sales improved 11.6% year over year, totaling up to $1.13 billion. This slightly exceeded out the Zacks Consensus Estimate of 1.10 billion. Moreover, net sales to people outside of the United States increased at a much greater rate of 34.2% since the previous year, showing strong international growth for the energy drink company.
In short, the increase in Monster Energy stock price probably had much more to do with it beating the estimates of analysts for projected increases and showing off strong gains in sales as compared to the previous year. It may well be a coincidence that the third-quarter earnings report was released on the same day as Death Stranding hitting the PS4, but it just as easily could have been brilliant timing on the financial folks over at Monster Energy.
So no, the stock price bump for the canned energy drink probably wasn’t because of Death Stranding. That’s not to say it didn’t help, mind, but a showing of strong gains over the last year probably had much more to do with it.
