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Anonymous

04 Oct 2019

Stocks

What are your thoughts on buying beyond meat share?

Would this be just a trend or actually feasible in the long term?

Discussion (2)

What are your thoughts?

Kenneth Lou

Kenneth Lou

04 Oct 2019

Co-founder at Seedly

I never knew they were a public company! But that's pretty cool, I went to dig up more information and here's what I found also..

It seems like in the space there are two main players in the space... Beyond Meat and Impossible.

I am going to reference a Business Insider Report which I read recently.
His price target is based off a five-year sales outlook plus a 50% premium to growth staples because of the long runway for plant-based meat.

“I think it’s going to be a tremendous category is going to be one of the fastest growing categories in food,” Brian Holland, a senior analyst at D.A. Davidson, told Markets Insider in an interview. “But I think there are limiting factors” to Beyond Meat’s growth, he said.

Wall Street has been very hesitant on Beyond Meat during the short time its traded publicly – the company IPOed in May. Of the 10 analysts that cover the shares, seven have neutral ratings on the company. Only one analyst – Ken Goldman of JPMorgan- has a buy rating on shares. When Holland initiated coverage, he became the second “sell” rating.

In a recent investor presentation, Beyond Meat spelled out plans to capture 13% of the US market share of traditional meat, about $35 billion of the $270 billion industry in the US. The company arrived at this number by calculating how much of the dairy milk market has been captured by plant-based milk.

But Holland is skeptical that Beyond can woo enough repeat consumers to grow that much.

“At the end of the day when you sell a food product, you only have the attention span of the consumer for as long as they have your package in their refrigerator or eating your sandwich at a restaurant,” Holland said.

After that, its can be difficult to keep consumers engaged. He argues that plant-based milk has been able to do this because there’s a solid share of lactose intolerant people in the US, a need for an alternative that Beyond doesn’t have.

There’s also healthy competition in the plant-based meat space, and because of that Beyond’s valuation “demands higher barriers to entry than do exist here,” he said. A number of other companies have recently gotten in the plant-based meat game, including larger food companies such as Tyson Foods, Hormel Foods, and Kellogg.

That said, Holland thinks Beyond Meat has a distinct first-mover advantage in plant-based meat. A majority of the plant-based milk category is controlled by two top players, Holland said, who were early movers – Danone, which owns Silk, and Blue Diamond, which owns Almond Breeze.

Going forward, Holland said that he’s open to reevaluating his rating. “I don’t think any stock is permanently a buy or sell,” he said. If the numbers were revised higher, “we would look at what the math said,” Holland said.

He also acknowledged that a deal with McDonald’s would change things for Beyond – analysts have said it could boost the stock price as much as 30% and would represent a huge win for the company, which has a lot of partnerships with restaurants.

Beyond Meat’s shares are up 516% year to date.

Cedric Jamie Soh

Cedric Jamie Soh

04 Oct 2019

Director at Seniorcare.com.sg

Alternative meat, either via vegetarian sources, or lab-grown source (ie, no animals would be harmed) is going to be a strong long term trend.

The world population is growing and there is no way we can keep up with the usual meat consumption.

Vegetarian or Vegan trend is growing.

That does not mean you should buy BYND (Beyond Meat) though. BYND is one of the pioneers does not mean it would be the best stock related to "meat-alternative".

The competitors are watching and some of the biggest meat producers in the world are already invested in new startup (or departments) for alternative meat.

Creative is the world's pioneer in portable music player, but I bet AAPL (apple) shareholders are happier than creativer shareholders.

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