![]() Note that underneath this, Beyond Meat's actual sales volume by pounds declined "only" -7% y/y.īeyond Meat volume declines (Beyond Meat Q1 earnings release) Revenue declines moderated, but not substantially, relative to -20% y/y declines in Q4. Take a look at the Q1 earnings summary below:īeyond Meat Q1 results (Beyond Meat Q1 earnings release)īeyond Meat's revenue declined -16% y/y to $92.2 million, essentially in-line with Wall Street's expectations of $91.7 million. Q1 downloadīeyond Meat's March quarter, which the company reported in mid-May, continued to showcase the company's difficulties at breaking through to consumers and highlighted a plethora of problems. Continue to steer clear here and invest elsewhere. In short, I see nothing but bad news for Beyond Meat ahead. In the current cautionary environment, wholesale resellers - which drive a substantial portion of Beyond Meat's revenue - are taking care to limit their inventory buys, which may ultimately reduce Beyond Meat's shelf prominence to end consumers. Considering the company is burning through roughly ~$50 million of adjusted EBITDA each quarter, this is a dangerous position for the company to be in. Beyond Meat's most recent balance sheet showed only $258.6 million of cash remaining, and that's not to mention over $1.1 billion of convertible debt. Limited liquidity is insufficient to finance huge losses.As a function of Beyond Meat's decision to cut prices, the company is operating at near-zero gross margins, which is an untenable position for a consumer-products company. It slashed prices particularly in the wholesale channel to account for this, but in spite of sharp price declines, the company is still experiencing double-digit revenue declines. Beyond Meat knows that one of the biggest obstacles to adoption is price: Beyond products are often more expensive, sometimes substantially more so, than regular meat. Price reductions have failed to stimulate demand.Other than this, here are the other key risk factors for Beyond Meat: While it's still too early to tell whether consumer acceptance of cell-based meats is widespread, it's fairly clear to say now that its existence will encroach on the market for Beyond Meat's plant-based meats. While in an experimental phase at the moment, and while these products still require hefty amounts of energy to produce (thus dissuading the energy-consumption crowd of meat-avoiders), cell-based meat products do significantly threaten Beyond Meat's base of animal-rights buyers, especially if taste is comparable to bona fide meat. Plenty of headlines emerged this week on the rising prominence (and US approval) of cell-based meat products. I remain bearish on Beyond Meat, and in particular, I think a new crop of risks have popped up for the company that will be difficult to avoid. The plant-based meat company has been hit with the equivalent of a demand revolt, with consumer interest in plant-based meats fading quickly - due, in no doubt, to a mixed bag of factors including taste, health concerns from sodium content, and price.īeyond Meat managed to hit a share price near $200 during the pandemic but today the stock sits at less than 10% of that value. There are a few holdouts, however, whose post-pandemic fundamentals have weakened so dramatically that it's difficult to imagine any rebound is possible.īeyond Meat ( NASDAQ: BYND) is one of these unfortunate laggards. In general, most small/mid-cap growth stocks have experienced a massive surge and rebound since the start of the year.
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