Wednesday 26 June 2019

Beyond Meat's forecast wows Wall Street as IPO darling delivers

Beyond Meat shares soared to a record last Friday after the faux-meat maker's forecast for annual sales topped estimates. (stock picture)
Beyond Meat shares soared to a record last Friday after the faux-meat maker's forecast for annual sales topped estimates. (stock picture)

Janet Freund

Beyond Meat shares soared to a record last Friday after the faux-meat maker's forecast for annual sales topped estimates.

Analysts are putting their faith in management's comment that the company is being "very conservative" in its projections, and that the sales outlook doesn't include foodservice customers until they are past the testing phase.

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This served as a green light for analysts to raise their revenue estimates above the IPO darling's target.

Shares rose as much as 36pc to $135.80 each, a record high. The stock has gained more than 400pc from its May 1 initial public offering price of $25.

The non-stop rally, however, has frustrated short sellers, who are trading in 34pc of the stock's limited float, which represents 19pc of the shares outstanding.

The shorts were down $155m in mark-to-market losses, bringing their losses to $321m since trading began, according to financial analytics firm S3 Partners.

JPMorgan's Ken Goldman said: "As long as Street forecasts fail to properly reflect BYND's remarkable potential, we remain overweight."

He noted that "eventually this stock's hefty valuation will more than offset the fast-growing fundamentals".

Bloomberg

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