Beyond Meat Inc (NASDAQ: BYND) is starting to look like a tunnel that doesn’t have light at the end of it. The stock’s crashed nearly 70% over the trailing ten months and there’s still another $20 to go, says Piper Sandler.
Beyond Meat has downside to $29 a share
In a note on Monday, Michael Lavery downgraded Beyond Meat to “underweight” and slashed his price target to $29 that represents another 40% downside from here.
According to the Piper Sandler analyst, a partnership with McDonald’s is unlikely to help the meat alternative company as much as initially thought. He wrote:
Given its lack of Beyond branding, there’s the risk MCD takes production in-house at the end of its 3-year contract with Beyond. Either way, the lack of clear branding mutes the carryover benefit from consumer trial at MCD into retail.
Beyond Meat is still burning cash
Among other reasons for the gloomy outlook were a lack of clear path to positive EBITDA, which, Lavery warned, will result in a hit to Beyond Meat’s value-to-sales multiple.
The California-headquartered company is confident that its meat substitutes will cost less than the animal protein by 2024. But the analyst warns the corresponding increase in volume will be insufficient to offset lower prices.
Last month, Beyond Meat reported disappointing results for its fiscal fourth quarter.
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