Citigroup started covering Hansen Natural(HANS) with a buy rating, citing the company's growth prospects.
Analyst Greg Badishkanian says that about 75% of Hansen's revenues come from selling energy drinks. The company sells brands such as Monster Energy Drink, in addition to natural juices and soda brands. Citigroup says the stock's price has risen 13 times in the past two years, but many investors are now betting against the company on the assumption that energy drinks are a fad and that the company will lose market share from increased competition. However, he believes the category will grow in the mid-teen range, and that the company will generate 18% earnings per share growth over the longer-term. He sees $2.04 2005 earnings per share and $2.53 in 2006.