Earlier this year, Beyond Meat became the first vegan meat brand to IPO — with huge success. It was initially priced at $25 a share, but ended up closing its first day at $65. Before the month was up, shares in the company had risen to $100.
After its initial success, shares began to fall in mid-July. According to CNBC, this was “amid a surprise secondary stock offering, a bigger than expected second-quarter loss, and a broader market sell-off.”
But American multinational investment bank JP Morgan has now upgraded Beyond Meat’s rating from neutral to overweight. It also lifted its target price from $188 per share to $189.
Explaining its decision, J.P. Morgan said in a statement to its customers, “with cash-on-hand likely to exceed $300MM by the end of 3Q, another guidance raise potentially ahead, and the stock 40% off its high, we think the stock is appealing once again.”
Analyst Ken Goldman added, “We see three primary reasons for renewed optimism: the potential to acquire new food-service customers, continued strength in measured data, and valuation.”
“We appreciate that the secondary offering spooked many investors; however, founder/CEO Ethan Brown trimmed only a tiny portion of his holdings, and we cannot blame anyone involved pre-IPO for locking in some gains,” he continued.
Through the BMV Global Market, Beyond Meat also recently became available to investors in Mexico. Its stock is priced in pesos and listed on the Mexico Stock Exchange as BYND.
What is the Future for Beyond Meat?
Los Angeles-based Beyond Meat is on a mission to change the future of protein. It has partnerships with major restaurant and fast-food chains, including Subway, Tim Hortons, Del Taco, Carl’s Jr, and A&W Canada, with, quite likely, even more on the horizon.
The pea-protein-based “bleeding” burgers and “sizzling” sausages are vegan. But the company’s main customer base is mostly meat-eaters. Ninety-three percent of its customers are flexitarian.
The brand believes that through realistic vegan meat products, it can help shift the food system away from animal agriculture, which it believes is unethical, unsustainable, and unhealthy.
“At Beyond Meat, we believe there is a better way to feed the planet,” it notes on its website. “Our mission is to create The Future of Protein — delicious plant-based burgers, sausage, crumbles, and more — made directly from simple plant-based ingredients.”
It continues, “by shifting from animal to plant-based meat, we are creating one savory solution that solves four growing issues attributed to livestock production: human health, climate change, constraints on natural resources, and animal welfare.”