Beyond Meat posts a profit, but it’s not enough to satisfy investors
(CNN) — Beyond Meat posted strong earnings and eked out its first quarterly profit, but investors were unimpressed.
While the company’s earnings and sales topped analysts forecasts Monday, shares of Beyond Meat fell 7% in after hours trading.
The stock made its Wall Street debut in May at $25 a share, and soared as high as nearly $240 before pulling back to its current price of around $100. That is quadruple the company’s initial public offering price, but many Beyond Meat skeptics think the stock is grossly overvalued.
Beyond Meat did report a strong quarter. Sales surged 250% from a year ago to $92 million, and the company had net income of $4.1 million, compared to a loss of $9.3 million a year ago.
The company also raised its outlook, but investors may have been disappointed because Beyond Meat’s new sales guidance of $265 million to $275 million for 2019 is only slightly higher than Wall Street’s current estimate of $264 million.
CEO Ethan Brown said in a statement that the company will “remain focused on expanding our distribution footprint, both domestically and abroad, building our brand, introducing new, innovative products into the marketplace, and bolstering our infrastructure and internal capabilities to fuel our future growth.”
But Beyond Meat is feeling the heat from more competition, despite having a leg up on rivals due to distribution agreements with big food retailers Walmart, Target and Sprouts as well as partnerships with restaurants Dunkin’, Denny’s and Del Taco.
Privately-held Impossible Foods has arguably the most popular plant-based product, thanks to its deal with Burger King to sell the Impossible Whopper. Impossible has also started to ship its product to grocery stores.
Burger King owner Restaurant Brands announced earlier Monday that its US locations posted their strongest sales growth in four years thanks in part to the Impossible Whopper.
Big Food companies are quickly catching up in the plant-based market share race, too.