On October 22nd, Beyond Meat (NASDAQ: BYND) updated the market on their third quarter financial results, saying that the company now expects third-quarter revenues of $106 million compared to the prior guidance of $120 – $140 million. They believe that this is due to “broader ongoing macro and the micro-economic factors,” as well as COVID-19 and severe weather impacting their operations.
After this news, a number of analysts lowered their 12-month price targets on the stock, bringing the average 12-month price target to $94.31, down from $116.71 last month. Out of the 18 analysts that cover the stock, 2 have strong buy ratings, 9 have hold ratings and 7 have sell ratings. The street high sits at $130 while the lowest comes in at $65.
Canaccord Genuity was one of the firms to lower their 12-month price target, dropping it from $125 to $100 while still reiterating their hold rating on the firm, writing that they still remain cautious after the news. They have lowered their estimates off the back of the news as well. They now expect full-year revenue to be $476 million, down from $525.4 million. 2021 EBITDA is now expected to be ($36.2) million compared to the ($21) million prior.
Canaccord believes that investors should remain on the sideline as a capital investment into the sector will only make companies play the race to the bottom with prices, which will weigh on revenue and margins. Additionally, 2022 is when most of the announced supply agreements end, while the inflation on pea protein isolate are expected to lead to higher costs.
They also believe that the food service will only have “tepid” growth, as at-home consumption is a major driver for the company, and as the economy starts to reopen it will likely drag on revenues.
Information for this briefing was found via Sedar and Refinitiv. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
