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On Thursday, Beyond Meat Inc . (NASDAQ:BYND) saw its price target significantly reduced by Bernstein from $6.00 to $2.50, though the firm maintained a Market Perform rating on the stock. The company, which has seen its stock plummet nearly 70% over the past year according to InvestingPro data, faces significant challenges. Analyst Alexia Howard at Bernstein highlighted that the first quarter of 2025 was disappointing and that the company had withdrawn its full-year 2025 guidance.
Beyond Meat reported sales of $69 million for the past quarter but expects to see an improvement in the next quarter with projected sales ranging between $80 million and $85 million. This anticipated increase is attributed to the company regaining shelf space at two major retailers. These retailers had previously removed Beyond Meat products from the fresh meat aisle but plan to reintroduce them in the frozen vegetarian section during the second quarter. InvestingPro data reveals concerning fundamentals, including weak gross profit margins of just 13% and declining revenue growth of -5% over the last twelve months.
Despite this positive development, Howard noted that the lower foot traffic typically seen in the frozen vegetarian aisle compared to the fresh meat section might continue to impact overall sales negatively. Bernstein’s decision to lower the price target is based on a slight increase in the sales estimate for the next four quarters, from $341 million to $344 million, coupled with a reduction in the EV/sales multiple from 4.5x to 4.2x, reflecting the ongoing challenges with volume and distribution.
The company is also faced with the need to address its convertible notes before they mature in March 2027. The analyst’s comments suggest that while there are some signs of sales recovery, the company still has significant issues to resolve moving forward.
In other recent news, Beyond Meat Inc. reported its first-quarter 2025 financial results, revealing a larger-than-expected loss. The company posted an earnings per share (EPS) of -$0.67, missing analysts’ forecasts of -$0.46, and revenues of $68.7 million, which fell short of the projected $77.77 million. Beyond Meat has withdrawn its full-year guidance due to macroeconomic uncertainties but expects second-quarter net revenues to be between $80 million and $85 million. The company aims to achieve EBITDA positivity by the end of 2026.
Beyond Meat also announced a new financing facility, securing up to $100 million in senior secured debt from Unprocessed Foods LLC to support its strategic initiatives. The company is facing challenges in the U.S. market, with weak demand in retail and foodservice channels impacting revenue growth. To address these issues, Beyond Meat is focusing on stabilizing its top line, expanding gross margins, and maintaining tight operating expenses.
In other developments, Beyond Meat is working on clearing up misinformation about its products and has launched a marketing campaign called "Real People, Real Results" to highlight the health benefits of a plant-based diet. The company continues to face distribution challenges as some retailers have transitioned its products from refrigerated to frozen aisles, affecting availability. Despite these hurdles, Beyond Meat remains focused on improving its financial position and operational efficiency.
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