Beyond Meat’s Earnings Sucked. Why BYND Stock Is Still a Buy.

What Happened to the Beyond Meat Stock Price Today?

  • Beyond Meat (NASDAQ:BYND) stock tanked more than 5% after the plant-based meat maker reported first quarter numbers that missed on both revenues and profits, and which included a ho-hum second quarter revenue guide.
    a package of Beyond Meat vegan sausages

    Source: calimedia / Shutterstock.com

  • BYND stock is now 4% for the year, and more than 40% off its early 2021 highs.

Why It Happened

  • Beyond Meat’s numbers were supposed to reflect two things.
  • One, a big rebound in the foodservice segment as restaurants reopened. Two, a minor slowdown in the retail segment as consumers stopped doing so much grocery shopping.
  • But Beyond Meat’s rebound in the foodservice segment was smaller than expected, with revenues still dropping 34% year-over-year, and the retail slowdown was bigger than expected, with sales up 45% year-over-year (versus 85% growth in the prior quarter).
  • The guide didn’t help matters. Beyond Meat basically guided in-line for Q2.
  • Investors are concerned that strength in Beyond Meat’s foodservice segment in 2021 may not offset weakness in the retail segment, and that growth will remain slow for the foreseeable future.
  • Worse yet, inflation is striking Beyond Meat, and profit margins are eroding on the back of rising input and transportation costs.
  • BYND stock plunged on the flurry of bad news.

Does It Matter?

  • This all feels like near-term noise.
  • The foodservice business will start to fire on all cylinders in Q2 and Q3 as restaurants fully reopen and we swing into the summer months. Plus, a ton of restaurants and fast food chains have added Beyond Meat products over the past year, so when those consumers go out and dine again, they’ll be greeted by Beyond products.
  • The retail business will slow. But it will remain vigorous, because consumers will forever grocery shop and because Beyond Meat has significantly expanded ACV in the retail segment with more doors and more products.
  • Long-term, the trend of plant-based eating remains healthy, and Beyond Meat continues to separate itself from the competition in terms of product availability, diversity, quality, and awareness.
  • BYND stock will rebound from this near-term weakness.

BYND Stock Price Forecast

  • When we look at the long-term analyst projections for Beyond Meat’s revenues into 2030, we think the Street is being very conservative. They see Beyond Meat as being a $5 billion revenue company by the end of the decade. We think that number will be closer to $10 billion.
  • Similarly, we think the Street’s consensus $140 price target on BYND stock is conservative. We think shares are worth around $200.
  • As restaurants reopen, BYND stock could make a run towards $200 during the summer months.

The tech sector meltdown has created multiple golden buying opportunities. And BYND stock is one such opportunity that ranks among my top “Plant Power” stocks to buy, but it’s far from my only pick.

The world is returning to its “roots”. Long story short, we are discovering the wonderful and multi-faceted benefits of plants, and starting to use plants to do everything from make food to treat illness. Beyond Meat is a leader in this megatrend, and will emerge as a critical solution to combat climate change, improve human health, and ultimately create a brighter tomorrow.

My top hypergrowth stocks in this megatrend include the companies shaping this brighter future with breakthrough plant-based products in the foods, medicine, and leisure segments.

Get the complete list of stocks to buy in the Plant Power megatrend by subscribing to Innovation Investor today.

On the date of publication, Luke Lango did not have (either directly or indirectly) any positions in the securities mentioned in this video.

By uncovering early investments in hypergrowth industries, Luke Lango puts you on the ground-floor of world-changing megatrends. It’s the focus of his premiere technology-focused service, Innovation Investor. To see Luke’s entire lineup of innovative next-generation mobility stocks, become a subscriber of Innovation Investor today.


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