Investors devour Beyond Meat as sales surge

Andrew Cummings
June 9, 2019

Beyond Meat's shares jumped more than 20 percent in after-hours trading. Excluding items, it lost 14 cents per share. The better-than-expected results and forecast led the stock to soar almost 21 per cent in extended trade on Thursday.

Beyond Meat reported revenue of $40.2 million, more than triple the prior year.

It also issued above-expectation guidance for full year 2019, forecasting sales to rise 140% year on year to $210m (vs a consensus estimates of $205m).

Burger King now plans to add the product nationwide this year. Some grocers, such as The Fresh Market Inc, which operates some 160 stores across 22 states, place Beyond Meat in the freezer with other veggie burgers or even the dairy section as they evaluate sales and decide on a long-term placement strategy.

Ten-year-old Beyond Meat burst into the spotlight last month with its successful IPO. Analysts consider Beyond Meat's strategic placement a "strong advantage" over competitors and a differentiating factor in reaching the broadest possible US market which they estimate to be $100 billion by 2035.


It's one of the biggest names in a growing category of vegan "meats" that are meant to appeal to both vegetarians and carnivores.

But the competition is stiffening, with Nestlé announcing earlier this week that it would be launching a plant-based product in the USA called the Awesome Burger.

"We're being very conservative and viewing this as a floor", said chief executive Ethan Brown.

Beyond Meat's burgers and sausages are made from pea protein, potato starch and other plant-based ingredients. Right now, the company makes all its products in Missouri and sells to 30,000 grocery stores, restaurants and schools in the U.S., Canada, Italy, the United Kingdom and Israel.

Will the world go meat-free? Companies have been making center-of-plate products based on Beyond Meat's offerings, as well as those from rival Impossible Foods.


Brown hinted that his company has entered into more tests with fast-food restaurant brands that he cannot yet disclose but which could promise more revenue in the future.

Still, heightened competition in the plant-based-meat space poses the biggest risk to Beyond Meat's stock price, Credit Suisse analysts said. The company does not count customers who are using its products as a part of a testing project.

Plus, Beyond Meat's stock has also gotten a boost when its competitor, Impossible Foods, announced new partnerships.

Canadian packaged meat producer Maple Leaf Foods Inc, which sells plant-based meat alternatives such as vegan ground beef under its LightLife brand, expects its products in the meat case of USA retailers by this summer.


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