Beyond Meat stock drops 20% amid poor sales, heads below first-time IPO price

Beyond Meat Inc. has taken 2022 not-so-good turned a bad turn for the worse on Wednesday with quarterly results lacking in excitement.

BYND Vegan Meat Products Manufacturer,
-13.83%
It posted a net loss of $100.5 million, or $1.58 per share, compared to a net loss of $27.3 million, or 43 cents per share, in the same quarter last year. Net revenue, at $109.5 million, up 1% from $108.2 million last year.

Analysts polled by FactSet had expected a net loss of 97 cents per share on revenue of $112.4 million.

The results sent Beyond Meat’s stock down 21% in after-hours trading Wednesday, after dropping 14% to $26.17 in the regular session. The shares were headed below the $25 price charged in the alternative meat company’s initial public offering for the first time since the stock began trading nearly three years ago.

“Although we recognize that the decisions we make today to support our long-term ambition have contributed to challenging near-term results, including a significant albeit temporary reduction in gross margin as we have taken cost-intensive measures to support critical strategic launches,” said Ethan Brown. , CEO of Beyond Meat, said in a statement announcing the results, “We are confident in the future we build as we move forward with our mission.”

However, Beyond executives warned of “near-term uncertainty related to macroeconomic issues, including inflation and interest rate hikes, COVID-19 and its potential impact on consumer behavior and demand levels, labor availability, and supply chain disruptions, which are in part attributable to to recent geopolitical tensions.” Beyond also presented fiscal 2022 revenue guidance in between $560 million and $620 million; Analysts polled by FactSet expect $580.7 million.

Then there is the McPlant puzzle.

McDonald’s Corp. MCD,
-0.51%
It made no mention of Beyond’s McPlant’s further expansion in the United States during last week’s earnings call after it earlier disputed a report that it planned to keep the veggie burger as a permanent item on the menu.

The confusion began after comments made by Morgan Flatley, McDonald’s global head of marketing, at the Fast Company’s Most Innovative Companies Summit on April 27, in which Flatley said customers’ dining experience would “dramatically change” in the future, likely including “Very well established products” with beyond meat like Mc Planet.

Beyond Meat’s stock has broken 60% so far in 2022, while the broader S&P 500 index SPX,
-1.65%
It has decreased by 17%.

Beyond’s battering has shed a bright light on the vegan meat market, and its ripple effect.

Impossible Foods Inc. , which has long been rumored to be a candidate for an IPO, is in a steady position, based on recent comments from its new CEO, Peter McGuinness.

“I don’t think it’s the right time for anyone right now because the markets are so volatile,” he told Food Navigator. “And in the case of the Impossible, the cash position is very strong, so there is a lot of investment to support all of this growth, so there is no urgent need for the IPO at the moment.”

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