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No miracle has happened – despite massive layoffs and the optimism of the CEO, Beyond Meat, Inc. stock can’t recover the momentum. Since the beginning of the year, the company’s securities have depreciated by more than 80%. Investor distrust is attributed to the company’s deteriorating financial position: revenues are falling and debts are rising.
As of the end of Q3, the net loss of Beyond Meat increased 1.9 times, and revenue fell by 22.5% (YoY) to $82.5 million. Analysts predicted a net loss of $1.15 per share on revenues of $93.6 million. According to CEO Ethan Brown, the deteriorating performance results from inflation and consumer uncertainty about the benefits of vegetable meat.
Recent scandals also don’t help. This September, Beyond Meat’s chief operating officer Doug Ramsey was charged with third-degree murder and battery. And how is the rest of the sector doing? According to the WSJ, U.S. sales of plant-based meat substitutes declined 8% in Q3. The exception was Impossible, whose revenue grew 49%.
Talking about perspectives, Euromonitor estimates the meat substitute market will be $2.5 billion by 2023. At that rate, one-tenth of the world’s meat will be artificial in the next ten years. Grand View Research analysts estimate that the global plant-based meat market will reach $25 billion by 2030.
The problem is that forecasts tend to fail, and this quarterly reporting season perfectly confirms that. We expected the worst, but it turned out even nothing. As for the vegetable meat industry, Deloitte analysts think that the market potential is limited. The association of meat substitutes with left-wing political ideas can also play against Beyond&Co. Given the above, Beyond Meat stock looks like a high-risk investment.
