The price of Beyond Meat stock has been on a downtrend since it reached its intraday 2021 peak of $221 a share back in January.
The stock has stepped into negative territory, shading 3.4% of its value year-to-date. This is in contrast to a wild 2020, when the stock surged 65% on the back of a strong post-pandemic rebound.
Only a few weeks ago, the company reported its financial results covering the second quarter of its 2021 fiscal year. Even though the market initially reacted positively, the price action ultimately caved on the back of a downbeat outlook for the third quarter.
Can Beyond Meat shares recover some of their lost territory during this second half of the year? In the following Beyond Meat share price forecast, we’ll analyse the latest price action and the company’s fundamentals.
BYND stock news
On 6 August 2021, Beyond Meat reported its financial results covering the second quarter of its 2021 fiscal year. Revenues landed at $149.4m for a 31.8% year-on-year increase, while adjusted gross margins were 31.7% below the figure for Q2 2020.
The company’s adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) swung to negative territory during the quarter compared to Q2 2020, moving from a positive $11.7m figure to minus $2.2m.
For the three months ended 3 July, Beyond Meat reported an adjusted net loss of $19.65m, resulting in a significant setback for the company’s profitability compared to the same quarter a year ago, when it reported adjusted net losses of $1.2m.
The company cited higher fixed overhead costs per unit, transportation costs, and depreciation and amortisation expenses as the leading cause for this downtick in top-line profitability. It mentioned a higher headcount, increased marketing expenditures, and legal expenses as the main reasons for the deterioration of its bottom-line results.
The company missed Wall Street’s earnings forecasts for the period as the consensus for its adjusted net loss a share stood at $0.23 against the reported $0.31.
BYND’s management forecasted sales between $120m and $140m for Q3 2021 in line with the Street’s estimate, as compiled by Capital IQ.
He added: “Given the recent uptick of COVID-19 cases, which could disrupt demand patterns, we believe caution for the balance of the year generally remains appropriate".
In a recent interview to The New York Times, Brown admitted that concentrating on quarterly outcomes is difficult:
He mentioned that the concept of Beyond Meat’s offering can be described as “hedonistic altruism”, meaning that the company strives to create “products that help people feel better about themselves, but also confer benefits to the world.”
BYND stock analysis: technical overview
The chart above shows how Beyond Meat has been on a downtrend ever since the stock hit its 2021 peak at $221 a share. The price recently bounced off the $100 level – a potentially important psychological threshold.
This bounce was accompanied by elevated volumes that exceeded the 10-day average, which reinforces the relevance of this level moving forward.
Moreover, the price declined only a few weeks after hitting a lower high at $160 a share that resulted in the formation of the current downtrend.
The fact that the RSI is making higher lows, despite the price moving lower in the past few sessions, along with the MACD’s weak but steady climb on the back of positive histogram readings, could tip the balance toward a bullish outlook for BYND.
Even though the odds are in favor of a potential upcoming third tag of the upper trend line highlighted in the chart, unless the downtrend is reversed, the outlook may continue to be bearish for Beyond Meat in the mid-term.
These opinions are made based on an analysis of the latest price action. The actual behavior of the stock price cannot be accurately predicted. Investors should conduct their own research and not rely solely on technical analysis to make any investment decision. Past performance does not guarantee future results.
BYND fundamental analysis
Beyond Meat revenues grew from $16.18m in 2016 to $406.8m by the end of 2020 as more people embraced the company’s products.
Meanwhile, gross profits have swung into positive territory since 2019 and gross margins have been progressively improving since then, also.
But the company has not managed to swing to profitability. Last year, BYND reported a GAAP operating loss of $49.35m, while net losses landed at $52.75m.
On a positive note, the only long-term debt the company has is the convertible senior notes it issued in March this year. These notes generate no interest expenditures for the business and could be converted into equity at an estimated price of $206 a share but only if the price of the common stock has exceeded 130% of the conversion price.
By the end of this latest quarter, the company still had $1bn in cash and equivalents that it can use for multiple purposes, including capital expenditures to expand its operations or strategic acquisitions.
At its current market capitalisation of $7.6bn, the business is trading at 19 times its 2020 sales and 14 times its forecasted sales for 2021, according to data compiled by Koyfin.
The company has grown sales at a compounded annual growth rate of 124% from 2016 to 2020. If Beyond Meat maintains this elevated growth rate, its current price-to-sales multiple may be justified.
Analysts’ estimates don’t appear to be giving much credit to this possibility as Beyond Meat sales are expected to jump 34% in 2021, 54% in 2022 and 30.4% in 2023.
All in all, it’s possible to qualify Beyond Meat as a growth stock due to its track record. As long as it maintains growth rates, its valuation could continue to climb.
This is an opinion made based on a thorough analysis of the firm’s past performance. And please note that a company’s past performance might not be replicated in the future and is no guarantee of future success.
Beyond Meat (BYND) stock forecast
Based on an assessment of the stock’s technical indicators and fundamentals, the current downtrend may continue unless a positive development pumps the stock price.
For BYND stock, a move above the $140 level could set in motion a fresh new bullish cycle. If that happens, a possible Beyond Meat stock prediction could see the price attempting to hit the $160 level.
It is also possible that the price remains confined within the boundaries of this descending triangle and the stock could plunge to the $100 area again – at which point a double-bottom pattern may form, if that support level holds for a second time.
BYND stock: buy or sell?
At the moment (2 September), 4 out of 18 analysts currently covering Beyond Meat are bullish on the stock, while 5 rate it a sell, according to data compiled by Seeking Alpha.
The average 12-month BYND stock projection stands at $122 a share, with the highest estimate at $150 and the lowest at $90.
Is Beyond Meat a good investment?
Beyond Meat is a relatively small company that is introducing a new product category. The rate at which its products are embraced by consumers will likely determine its future. Given the uncertainty regarding its ability to achieve this goal, BYND should be considered a risky investment.
If you are not ready to buy the stock as a long-term investment, you can always speculate on price fluctuations using contracts for difference. CFDs give you the possibility to go long or short on an asset, depending on your BYND stock projections. Note that CFDs are leveraged products, which involve a high degree of risk as the use of leverage can magnify losses if the asset price moves against you. Track the Beyond Meat stock performance live, conduct your own due diligence and spot the best levels for potencial CFD trades.
Trade Beyond Meat, Inc. - BYND CFD
Even though nobody can accurately predict what a certain stock will do in the future, an algorithm-based Beyond Meat stock forecast for 2021-2025 from Wallet Investor pitches BYND as an “acceptable” 1-year investment. However, it sets rather conservative price targets for the stock – $127.74 in a one year period and $153.20 in five years. You should always conduct your own thorough analysis to decide whether to include a particular stock into your investment portfolio.
Beyond Meat is an up-and-coming business that has grown at a fast pace. However, past performance does not guarantee future results and given the relatively volatile nature of the market segment that this company serves, this stock should be considered with caution.