Hansen’s chief executive, Rodney Sacks: “We believe we can keep growing.”

Jun.03, 2008 in Market Outlook

Keeping up such stratospheric growth will be even tougher for this year’s class, given the economy. That’s especially so for Hansen Natural (HANS). Our No. 1 company, best known for its Monster Energy drink, has long been a favorite of short-sellers. After a torrid growth trajectory—profits rose from $20 million in 2004 to $149 million last year—the company’s honeymoon with investors ended abruptly last November when it missed analyst estimates, due in part to higher costs for raw materials. The stock has tumbled 46% since.

“We Can Keep Growing”

But Rodney Sacks, Hansen’s chief executive, says he can sustain growth and is ready to adapt to the times. That may mean more “2 for $3″ and “3 for $5″-type promotions for cans of Monster. And Hansen, which has ranked on the Hot Growth list in three of the past four years, has rolled out new products such as its Java Monster coffee drink and a juice line aimed at kids. “The shorts had it wrong in the past and have it wrong now,” says Sacks. “We believe we can keep growing.”

Like Hansen, many of this year’s Hot Growth companies are sticking with product launches, despite the fact that consumers are on the ropes. That’s the case with Under Armour (UA) (No. 34), another repeat Hot Growth performer. Even with its sports apparel business up by 37% last year, the Baltimore upstart threw down the gauntlet against Nike (NKE) in May when it rolled out its first sneaker, a cross-trainer. Under Armour Chief Executive Kevin Plank knows that Nike will stop at nothing to protect its market share in shoes, but he believes the move into footwear was necessary to keep growing.

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