Beyond Meat (NASDAQ: BYND) had an IPO price of $25 in May 2019 and rapidly hit a high price of ~$235 in July of the same year. The stock has underperformed since, hitting a low of $54 in March 2020 during the COVID fallout. The stock is currently trading at the $107 mark, and we believe there is strong upside potential thanks to their growth fundamentals.  

BYND is an American company that produces plant-based meat substitutes that imitate the look, taste, and texture of animal-based meat. The company’s growth and success have accelerated in recent years due to their international expansion and the announcement of exciting partnerships with global players in the food industry.

Partnerships

BYND is partnering with exclusive names that will allow their product to reach an increasingly larger audience. In this period of growing consumer awareness around sustainability and health trends, producers and food companies are looking to modernize their offerings to include non-meat and plant-based options. More and more consumers are considering the health and environmental impacts of the food they purchase and consume, which creates a cultural shift and opportunity for Beyond Meat to be a clear market leader in this segment.
Earlier this year, BYND announced a global strategic partnership with Yum! Brands, which operates KFC, Pizza Hut, and Taco Bell.
More recently, McDonald’s has just announced a multi-year partnership with BYND and has started testing their meatless “McPlant” burger in the US and Europe at select locations. This is an enormous opportunity to make Beyond Meat a household name, as McDonald’s is the world’s largest fast-food restaurant chain by a large margin. BYND will continue to expand their collaborations with large and successful players in the industry, and these wins will feed through to their financial results and stock performance.

Revenues

BYND is already seeing phenomenal growth. 2020 fiscal year revenues were $470 million revenues, up 57% from $298 million in 2019. Whilst the company is not profitable at the bottom line yet, that is not a significant concern and is a typical sign of a growth stock. Large investment spending is necessary and justified for international expansion, research & development into improving the quality and range of the products, as well as marketing. Wall Street analysts currently have a consensus view that the company will have a consistent net profit from 2022 onward.

Vote of confidence

BYND is becoming a popular name for a growing consumer base but it is also proving very popular with important institutional investors. Baillie Gifford and Vanguard own a combined 20% of shares outstanding. Baillie Gifford in particular has proven to be one of the best performing asset managers in the world by being early investors in high growth stocks, making returns of +6000% and +8000% in Amazon and Tesla respectively. Will BYND be their next big payday? Make sure that you do not miss out on this opportuntity to invest in an exciting industry in transition.

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