Monster Beverage (MNST) is expected to benefit from improving margin trends after Q1 revenue missed estimates by Wall Street analysts, Deutsche Bank said Friday in a note.

Negative reaction to the Q1 results "may prove short-lived given the strong April snapback and more resilient gross margin delivery," the note said.

Deutsche Bank sees "higher likelihood for net-improved margin trajectory as the top line recovers and supply chain efficiencies continue to materialize."

Energy drink demand trends "remain strong across many key markets," the note said.

"While our sales estimate falls due to the magnitude of the Q1 shortfall, our margin forecasts rise more significantly" with the full-year EPS forecast up to $1.91 from $1.85), the note said.

Deutsche Bank raised its price target on Monster Beverage stock to $68 from $66 and maintained its buy rating.

Monster Beverage shares rose 2.3% in recent Friday trading.

Price: 61.52, Change: +1.38, Percent Change: +2.29