Beyond Meat goes beyond expectationsA sales beat, however, was not enough to keep the sizzle for long.
- If you rushed to sink your teeth in Beyond Meat shares on Friday, you are likely left with a sour taste now. The vegan burger maker posted impressive fourth-quarter sales of $79.9 million, topping estimates for $75.8 million. It even announced better-than-expected forecasts for 2023.
- Shares of the Nasdaq-listed plant-based meat company soared on Friday, peaking at roughly $22 a pop. Shortly after, investors lost appetite and sent the stock lower by more than 12%, closing the session at $18.88 a share.
- Inflation has been eating away at Beyond Meat’s sales as consumers turn to cheaper meat options to offset rising costs. Since Beyond Meat’s valuation hit an all-time high of $13 billion, a big bite has been taken out of it as 92% of that value is now missing.
Vegan exec consumes human noseOf all the tasty things that could tempt a vegan food exec to the dark side, a human nose was literally last on my bingo card.
- A man’s nose looked too delicious to resist as Beyond Meat COO Douglas Ramsay took a nibble during an altercation after a college football game. The 53-year old Ramsay now faces charges of third degree battery, ‘terroristic threatening’ and perhaps even banishment from the vegan community – we can’t imagine they’re too fond of cannibalism.
- The company's share price has been ‘beyond red’ recently, plummeting by almost 20% last week to reach a new all-time low of just $17 per share. It’s fallen pretty far from its all-time high of $234.90 per share in July 2019 after one of the most successful IPOs in recent years – maybe that’s what’s got him so fired up?
- BYND’s not the only plant-based stock that inflation’s been munching into. The fear of upcoming bad news from the Fed has seen Oat milk manufacturer Oatly drop by more than 8% last week and artificial meat producer Agronomics plummet by almost 10% over the same period. If the future is indeed vegan, it’s not looking particularly tasty rn.
The retail army gets stuck inLast week served up Q2 earnings from retail faves like Beyond Meat, and the day trading army rolls up its sleeves and tucks straight in despite some undercooked results.
- Beyond Meat’s earnings were beefy enough to disguise the taste of tofu at first, but came with none of the trimmings. The plant-based brand reported a wider-than-expected loss and weak sales for the second quarter, paired with a lowered 2022 revenue forecast and plans to trim its workforce by 4% thanks to macroeconomic conditions.
- Doesn’t sound great, right? No – but its stock skyrocketed nearly 22% on Friday despite falling 2% in Thursday’s after hours, hitting its highest level since early May. Trending on social streams all day, it seems BYND managed to get caught up in a meme stock short squeeze that saw a day of crazy gains despite a week of worse-than-expected news.
- Other trending tickers included faves like AMC, BBBY and CVNA. Apes sent AMC up 19% to a four-month high – despite an after hours drop and poor earnings – after news of an “APE” dividend, Bed Bath & Beyond soared 32% after discontinuing one of its private labels and is now the most shorted stock on the Nasdaq, and second hand car brand Carvana revved 40% despite cutting guidance. Busy day for the army.
A sizzle-less earnings reportBeyond Meat releases a limp earnings report that lacks the sizzle a truly great burger needs, sending shares to fresh all-time lows.
- The stock saw prices dump down 25% in extended trading on Wednesday, extending the day’s 13% loss and taking shares to a new low of under $19. Lifeless earnings were behind the bashing, missing on both ends with LPS of $1.58 on revenues of $109.5bn.
- Turns out kindness can kill the balance sheet. The company has been offering steeper discounts and cheaper prices to international consumers to lure in a loyal following, which together with its new jerky venture (which weighed heavily on margins) is responsible for the wider-than-expected loss.
- CEO Ethan Brown is trying to appeal to the bulls – the market bulls obvs, they like to leave the real life ones alone. He says that while long term growth investments might be pressuring the company now, he’s convinced it’ll pay off in the future. Though he would say that, being the CEO. Let's see how the year pans out.
The veganning of the end?Beyond Meat releases its second consecutive set of stock-tenderizing earnings, but prices get plumped back up as the overall market claws back its sharp losses.
- Prices sank 10% in Thursday morning trading before recovering along with the broader market to close up 3.38%. The vegan brand missed on both ends in Q4, reporting a loss per share of $1.27 (wider than last year’s $0.40 per share) on revenues of $100.7m.
- The plant-based firm blamed weak U.S. retail sales, which suffered due to soft demand, increased discounts and a loss of market share. It also faced higher costs thanks to its reliance on outside production facilities, which comes with its own set of extra logistics and transportation costs, all of which put pressure on margins.
- It’s switching its focus from groceries to fast food chains. Grocery sales in the U.S. slumped 19.5% to under $50m, but it has made major progress on the fast food front and struck deals with McDonald’s, KFC, and Pepsi. CEO Ethan Brown thinks fast food popularity will help drive grocery sales back up, but guidance for the current quarter still missed estimates.
Jean Colet / Unsplash
Vegains gone badKFC gets Beyond Meat investors drooling before an advertising faux pas turns things rotten.
- Prices jumped 7% in Wednesday morning trading before plummeting to close down over 5% at its lowest price since April 2020.
- Its partnership with KFC to serve Beyond’s plant-based chicken across America got investors licking their fingers, but the delicious dish was soon whipped away from them.
- Turns out the chicken isn’t actually completely vegan. While the recipe itself is vegan, it’ll be made in the same kitchen as all the meaty dishes (which kinda defeats the point, no?), sending investors looking elsewhere for their lunch.
Big Macs and BeyondBeyond Meat gets the breath of life from some analyst optimism.
- Prices jumped 9.29% on Tuesday after hitting its lowest price since April 2020 on Monday.
- Piper Sandler hiked its price target on the stock. The optimism is down to its product launch with McDonald’s (MCD), which plans to expand its McPlant burger (its colab with Beyond Meat) across the U.S. after seeing crazy demand.
- Will it be enough to breathe life into its earnings? The stock is down 26% since disappointing Q3 results on November 10 felt the effects of dwindling demand.
Andrea Leopardi / Unsplash
Beyond Meat gets burnedBeyond Meat earnings have less life in them than one of their vegan burgers, sending prices plummeting 13% on Thursday.
- Beyond Meat missed on both ends with Q3 earnings, and losses mounted to $0.87 per share on expectations of $0.39.
- BBQ season is over and dwindling demand for its meat-free groceries dragged U.S. sales down 13.9% y-o-y, although the international market still thrived.
- Leadership stays committed to the long game and blames the massive loss was on short-term supply shortages and bad weather.
- Analysts aren't so sure. Has the meat-free market has become too saturated for Beyond Meat to compete?
- Weak sales forecasts of $85m to $110m did nothing to ease fears, coming in way lower than the $131m analysts expected.
$1bn raised in bond offeringThere's clearly investor appetite out there for plant-based patties, as Beyond Meat successfully upsizes its $750,000 convertible senior notes offering to $1 billion on the back of strong demand.
The firm originally announced the debt deal on March 1, with plans to offer $750,000 in convertible senior notes. Some of the funds raised are likely to be used to fund privately negotiated capped call transactions, which are often used to artificially increase the conversion price of a convertible security.
On March 2, the deal was upsized to $1 billion with initial purchasers offered the chance to buy a further $150 million within 13 days of issuance (March 5). The convertible notes are expected to mature on March 15, 2027, although noteholders can convert the notes from and after December 15, 2026, and Beyond Meat can settle the conversion either in cash or in a combination of cash and shares. The notes are also redeemable for cash at Beyond Meat’s option, any time after March 20, 2024, but only if the last reported sale price per share of Beyond Meat’s common stock exceeds 130% of the conversion price.
The market didn't much like the idea of such high leverage, with the stock dropping 5% to close at $139.66 on March 2. However, Wall Street remained cautiously optimistic, and DA Davidson analyst Brian Holland raised his price target from $133 to $145 on the news.
Fast food and FY resultsWow, big day. Beyond Meat announces Q4 results, which slightly miss expectations, but bounces back with news of two major new partnerships with McDonald's and Yum!
February wasn't the greatest month for Beyond Meat, with shares sliding from a high of $221 on January 26 (where they had soared following news of the firm's latest deal with Pepsi) to a low of $138.95 during trading hours on February 23, a loss of over a third (37%).
Q4 results were adequate, but didn't do a whole lot to boost confidence. Net revenues for 2020 climbed 3.5% to $101.9 million, but the firm booked a net loss of $25.1 million for the quarter (compared to $925,000 the previous year). Even excluding expenses related to Covid-19, adjusted net loss was $21.4 million, or $0.34 per share, missing Wall Street expectations of $0.13.
Annual results were slightly more promising. Fully year net revenues were $406.8 million, an increase of 36.6% year-over-year. Annual net loss was $52.8 million, or $0.85 per common share – compared to $12.4 million in 2019. CEO Ethan Brown said he was proud of the results, given the pandemic pressures and weakened demand for foodservice, and noted that the focus for 2021 would be strategic investments for future growth: including the build out of production facilities in China and Europe, bolstering research and development capabilities, amplifying the firm's marketing voice, and upgrading IT infrastructure.
On the same day, the firm announced two major new three-year partnerships with McDonald's (MCD) and Yum! (YUM) (whose brands include KFC, Pizza Hut, and Taco Bell.) The firm (which first partnered with McDonald's back in 2019 to develop a plant-based burger in Canada) will provide McDonald's with the patty in the McPlant, a new plant-based burger being tested in select McDonald’s markets globally, as well as exploring the co-development of other plant-based menu items as part of McDonald’s broader McPlant platform. With Yum! Beyond Meat will offer "signature plant-based menu items" across its brands. KFC was the first national U.S. quick-service restaurant to introduce plant-based chicken when it tested Beyond Fried Chicken at an Atlanta-area restaurant in 2019.
The market wasn't too keen on Q4 results despite the positive partnership news, and shares lost 5.46% on results day, February 25, to close at $143.75.
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Big boost on the back of Pepsi PartnershipIn an unexpected twist, Beyond Meat teams up with fizzy drink giant PepsiCo to develop a new range of plant-based snacks and drinks through a joint venture called the PLANeT Partnership. Shares jump almost 18% by close.
Financial terms weren't disclosed, but the range is expected to launch later this year. It was a surprise move that no one was really expecting, but it offered a boost to Beyond Meat that the company maybe kinda needed, after missing out on the McDonalds contract last year. The publicity of joining up with such a big name brand didn't hurt either, and PepsiCo were pretty darn enthusiastic about the whole thing.
“Plant-based proteins represent an exciting growth opportunity for us, a new frontier in our efforts to build a more sustainable food system and be a positive force for people and the planet, while meeting consumer demand for an expanded portfolio of more nutritious products,” said Ram Krishnan, PepsiCo Global Chief Commercial Officer. “Beyond Meat is a cutting-edge innovator in this rapidly growing category, and we look forward to combining their unparalleled expertise with our world-class capabilities in brand-building, consumer insights and distribution to deliver exciting new options.”
The share price jumped from $158.73 at the close of January 25 to hit a high of $221 on January 26, before sliding slightly to close at $186.83.
Millionaire-maker?Investor Rich Duprey suggests that Beyond Meat could be a “millionaire-maker” stock, citing positive growth prospects and a surprisingly strong 2020 performance that saw the share price increase by over 65% on the year, despite coronavirus challenges.
Duprey pointed out that despite recent setbacks and poor third quarter results, Beyond Meat could be in for a boost if yet another meat shortage hits the US, leading to a new round of panic buying. JBS, the world's largest meat supplier, recently sent home about 8% of its U.S. workforce over rising COVID-19 cases, which could spell bad times ahead for the meat industry – and good times for meat alternatives.
Plans to expand further and bring production in-house to lower costs are all positives, while new markets China and Brazil offer strong potential. Overall however, the outlook is cautious.
“Beyond Meat as an early mover in the space still has a lot of growth left in it, and it has arguably tapped into consumer demand for plant-based meat alternatives better than the competition. Yet there also seems to be a finite market for its product -- and only a certain subset of consumers are likely to be regular repeat customers,” noted Duprey. “Its stock is also quite pricey, it needs to show that it can have sustained growth outside of a global pandemic, and can rise above the competition.”
A Christmas No 1?Let’s end the year on a high note, thinks Beyond Meat. Let’s bring a little festive cheer to the world. Let's launch a Christmas single with three-time NBA champion and Grammy Award-nominated music producer Javale McGee and his vegan NBA buddies Chris Paul and DeAndre Jordan.
Calling themselves ‘The Beyond Boys’, the guys did a rousing version of ‘The 12 Days of Christmas’ but, you’ve guessed it, replacing all those useless gold rings and dancing girls with different delicious Beyond Meat recipes. Whatever floats your boat.
Beyond Meat has been closely linked with the NBA since its inception, with professional athletes including Shaquille O’Neal, Derick Morgan, McGee, Paul, Jordan, and more all joining the firm as investors and participating in numerous brand campaigns. What it is to have friends in high places.
Sadly, it didn’t make it onto the charts.
Buying in bulkBeyond Meatballs launch in Costco warehouses across the US, meaning customers can now buy their favorite plant-based balls in bulk.
Customers can pay $9.99 for 24 meatballs (compared to a usual RRP of $6.99 for 12) at select Costco locations in New York, New Jersey and California. That some serious savings. The launch follows Beyond Meat’s first foray into Costco in 2019 via its Beyond Burger.
The stock stayed steady at around $140.
Poor results shake confidenceShares initially rise ahead of Q3 results day on November 9, but the markets are shaken when revenues badly missed earnings expectations. The stock loses 4% in a day, dropping to $150.50 off the previous close, and slipping as low as $141 during trading. By the end of the week (November 13) it’s down 17% to $124.74.
Sales grew just 2.7% annually to $94.4m as the full brunt of Covid finally hit – its slowest sales growth ever since going public, and it posted a net loss of $19.3m. Things weren’t helped by McDonald’s (MCD), which announced on November 9 that it was launching a meat-free McPlant line, using its own in-house formulation rather than working with a third-party supplier.
Beyond Meat did launch a new Beyond Italian sausage pizza at Pizza Hut on November 11, with a Twitter video fronted by actor Kevin Hart. And on November 16, it unveiled two new versions of its Beyond Burger, expected to launch nationwide in early 2021, featuring an “enhanced meaty flavor” but with 35% less saturated fat. So you can be greedy AND healthy at the same time. Win win.
Downgrades drive dipBeyond Meat loses all its gains for October after a dire fortnight that includes an analyst downgrade and fears over increased competition. The stock ends the month down 27% on its high of $194.94 to finish at $142.43.
Analysts are starting to become unwelcome dinner guests. Wall Street firm Bernstein downgraded the stock on October 13 from “market perform” to “underperform”, warning that its recent rally had “stretched” its valuation.
There was also new competition from Tyson Foods (TSN), which launched its first Unchicken sandwich in the US. And at the end of the month top rival Impossible Foods expanded its retail competition into Canada, putting it head-to-head with Beyond Meat, which had long relied on the country as a key market and testing ground.
Pedro da Silva / Unsplash
Edging higher on McDonald’s rumorsThe stock hits a high for 2020, buoyed by a couple of weeks of good market news that places it 14.2% higher than the start of the month at $194.94.
October started with a meaty rumor that McDonald’s (MCD) was partnering with Beyond Meat to launch a vegan burger in the UK. A mystery Instagram user called Vegan Food UK shared an image showing a ‘new vegan burger’ featuring a Beyond Meat patty. The post said: “This image is from a survey that someone had from McDonald's in the UK. Nothing is official until McDonald's says so 🙂. We aren’t sure of a launch date yet but we know they have had this in the pipeline for a while.” Intriguing.
The strong month was topped off a day later after the US District Court for the Central District of California rejected a shareholder class action against Beyond Meat which claimed it had failed to disclose the extent of litigation against it from Don Lee Farms. The judge ruled there was no evidence of misleading information.
October started with a meaty rumor that McDonald’s was partnering with Beyond Meat to launch a vegan burger in the UK. Photo: Jurij Kenda / Unsplash
New Chinese factories bump priceThe Asian expansion continues as Beyond Meat confirms plans for two new production facilities in China, pushing its stock up 15.5% from an opening price of $123.81 on September 8 to $143.04 once the markets fully digested the news on September 10.
Beyond Meat signed an agreement with the Jiaxing Economic & Technological Development Zone on September 8 to design and develop manufacturing facilities close to Shanghai, making it the first multinational company focused solely on plant-based meat production to bring its own major production facility into China.
By September 29 Beyond Meat had also secured a major deal to expand its partnership with the world’s oldest retailer, Walmart (WMT), sending its stock up 9.4% on the previous day’s close to $165.66. The partnership saw the Beyond Burger offered in about 800 locations through more than 2,400 Walmart stores.
This delighted investors, who were already salivating over the popular frozen Beyond Breakfast Sausage Patties, which had doubled distribution at the end of September with expansion into Kroger (KR), Super Target (TGT), Walmart (WMT), Publix and Harris Teeter stores
Investors also got excited by the impending launch of Beyond Meatballs in October at Whole Foods Market, Stop & Shop (AD), Sprouts, Harris Teeter, Kroger and Albertsons (ACI). This took Beyond Meat’s supermarket presence to 26,000 outlets across the US. The meatballs had previously only been offered in Subway’s Beyond Meatball sub.
There was added good news from SPINS data for the four weeks ending 9 August 2020 that showed Beyond Meat was the number one selling brand in refrigerated plant-based meat. Now Beyond Meat was booming in both supermarkets and restaurants.
Ehud Neuhaus / Unsplash
Lightlife Foods issues attackBeyond Meat and arch rival Impossible Foods find a common enemy after Lightlife Foods publicly urges them both to stop using “processed ingredients” that are “unnecessary and confusing” for consumers.
The division of Canadian meat-industry giant Maple Leaf Foods (MFI) issued an open letter to Beyond Meat and Impossible Foods that said: “Enough with the hyper-processed ingredients, GMOs, unnecessary additives and fillers, and fake blood.”
Beyond Meats said in response: “If they were clear on our ingredients, they would see that our products are made with simple, plant-based ingredients. With no GMOs. No synthetically produced ingredients. Our products are designed to deliver the same taste and texture as animal-based meat but are better for you and the planet. We believe it’s the future of food.”
The Beyond Meat share price spent the rest of the month stumbling around $125, with even the launch of its own direct-to-consumer e-commerce site doing little to satisfy the markets.
Second quarter slumpDisappointing second quarter results reveal the impact of the pandemic on Beyond Meat and send the brand’s stock down 6.7% to $132.69 in opening trading.
Markets were notably concerned at how much it had cost Beyond Meat to navigate the outbreak.
Food service sales slumped by over 60% during the quarter, and the firm spent $5.9m on repackaging its products to be sold at grocery stores instead. Net sales rose 69% annually to $113.3m but Beyond Meat posted a total net loss of $10.2m, even wider than the $9.4m loss in the first quarter.
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