Hansen stock hummers as sales growth continues.

Hansen Natural Corp. is getting a taste of just how merciless life on Wall Street can be, even for a company whose signature beverage product is still seeing rapid sales growth.

The Corona-based maker of the popular Monster energy drink missed average consensus earning estimates by just one penny last week only to see its shares fall 26 percent to $29.85 during a brutal one-day sell off.

Call it the victim of its own success--and the unreasonable expectations of growth-oriented investors.

Prior to the Aug. 7 earnings report, Hansen was trading right around $40. And while that was off from a high of $51.34 on July 5, it was still trading at what clearly turned out to be an unsustainable multiple of its earnings.

Hansen's price-to-earnings ratio topped out at roughly 60 to 1 in late May, but earlier this month it was still in the 50 to 1 range. After the sell off, it had dropped to about 33 to 1, much closer to the average multiples of the largest 100 non-financial stocks on the Nasdaq, where it's listed. Those stocks have been trading in the low 30s range all year.

Hansen had the kind of stock run up that usually results in a fall. While it was based on the growing popularity of its Monster brand energy drink--a beverage that is still gaining adherents--late-to-game investors were betting that its sales growth would continue to accelerate.

What happened is simple: the company turned in what in almost any other circumstance would be a stellar earnings report but sales were slower than expected--compounded by the fact that the company had beaten analysts' forecasts for months.

Second quarter earnings came in at $28.2 million (28 cents a share), up 86 percent from the same period a year earlier. Net sales were up 83 percent to $156 million. However, Wall Street analysts were expecting earnings of 25 cents to 34 cents, for an average of 29 cents.

But don't cry too much for Hansen investors, at least those who got in early this year. The stock, which continued to fall through the week, was still up 41 percent for the year as of its Aug. 10 close at $27.80.

Moreover, by at least one analyst's estimate, sales of Monster energy drinks were still growing at an extraordinary rate. And that's something likely to continue as some distributors of

Lofty Heights

Hansen Natural Corp. saw its price-to-earnings ratio climb to unnatural highs this year, as measured against its Nasdaq peers.

Anheuser-Busch Cos. Inc. beer started handling the drink under a previously announced deal that is expected to only widen its retail availability.

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