A popular food chain recently pulled a deal with the plant-based company, sending down its stock price. Is Beyond Meat simply just a phase?
Beyond Meat (NASDAQ: BYND) recently had a trial of its plant-based burgers axed with food giant McDonald’s (NYSE: MCD) in Canada. However, on July 22 the plant-based company announced it will be producing a new veggie burger, locally in Canada. Beyond Meat’s stock has soared more than 72% for the year to date, but does this mean that there simply isn’t the appetite for a substitute and will other large chains follow suit?
Beyond Meats pens new deal
This recent downturn hasn’t stopped the company from continuing to expand into other markets. On July 15, 2020, Beyond Meat announced it will be selling its meatless products in Brazil, which is the world’s second-largest beef market, behind the EU and U.S. This news saw its stock rise 4.9% on July 15.
On top of this, the business just signed a deal with Alibaba (NYSE: BABA) to supply its products at some of its grocery shops in mainland China. Beyond Meat also continues to sell its plant-based products through Dunkin’ Brands (NASDAQ: DNKN) and is also tied to other high-profile partnerships with Del Taco (NASDAQ: TACO), Subway and KFC.
Is Beyond Meat just a fad?
The tasty meatless products have made it more accessible for flexitarians, who want to reduce their meat intake. Combined with the possible health benefits of plant-based eating and environmental concerns, the industry is getting a lot of attention. Before the pandemic hit, U.S. meat-alternative products saw sales rise by 54%, and Beyond Meat’s increased by 190% in the twelve weeks ending March 22. Beyond Meat’s growth rate was six times that of its closest competitor, Impossible Foods.
This growth has been reflected in Beyond Meat’s top-line revenue which has grown from $16 million in 2016 to almost $300 million in 2019. Despite the ongoing challenges of the coronavirus for businesses around the world, the plant-based company’s first-quarter revenue was up by 141% to $97.1 million compared to the same time last year. Overall, its main pure-play competition is not yet a publicly listed company and Beyond Meat is poised to continue growing in the long-term.
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