Beyond Meat, Inc.

BYND Details

Beyond Meat, Inc. (NASDAQ: BYND) is a food company that specializes in plant-based meats. Beyond Burger, Beyond Sausage, Beyond Beef, Beyond Meatballs, Beyond Breakfast Sausage Patties, Beyond Breakfast Sausage Links, Beyond Beef Crumbles, and Beyond Italian Sausage Crumbles are some of the company's products. Across the three primary meat platforms of beef, pork, and poultry, the company distributes a variety of plant-based goods. As of December 2021, its products were available in over 130,000 retail and foodservice establishments throughout 90 countries.

Latest News:

• Strengthening Collaboration with Pizza Hut: On January 10, 2022, Pizza Hut and BYND announced the launch of plant-based Beyond Italian SausageTM Crumbles in all Pizza Hut Canada locations. Beyond Italian Sausage, Crumbles are available in three delicious Beyond Meat® recipes designed to replicate the meaty texture and delectable savory flavors of Pizza Hut's traditional Italian pork sausage. This summer, these new Pizza Hut menu options are back by popular demand, following a successful trial in Toronto and Edmonton.

FY21 Results:

• Double-Digit Growth in Topline: The company reported YoY growth of 14.24% in net revenue to USD 464.70 million in FY21 (ended December 31, 2021) from USD 406.79 million in FY20, driven by 76.86% YoY growth in international net revenues.
• Expansion of Losses: In FY21, BYND's net loss expanded to USD 182.11 million from USD 52.75 million in FY20.
• Cash and Debt Position: The company had USD 733.29 million in cash and cash equivalents as of December 31, 2021, and total debt of USD 1.13 billion.

Key Risk:

• Dependence on Third Parties: BYND has signed a multi-year plant-based protein sales agreement with one of its third-party pea protein suppliers, which requires it to purchase minimum monthly and semi-annual volumes for the contract term. If it cannot swiftly substitute pea protein or other raw materials, any supply disruption might substantially negatively impact its business.

Outlook:

• FY22 Guidance: As of FY21, BYND expects FY22 net sales to be about USD 560 – 620 million, representing a YoY growth of 21% - 33%.

 Valuation Methodology: EV/Sales Multiple Based Relative Valuation

(Analysis by Kalkine Group)

* % Premium/(Discount) is based on our assessment of the company's FY1 trading multiple after considering its key growth drivers, economic moat, stock's historical trading multiples versus peer average/median, and investment risks.

Stock Recommendation:

BYND's stock price has fallen 72.24% in the past nine months and is currently leaning towards the lower end of its 52-week range of USD 41.33 to USD 160.28. We have valued the stock using the EV/Sales-based relative valuation methodology and arrived at a target price of USD 52.48.

Considering the significant correction in the stock price, strategic collaboration, positive outlook, associated risks, and current valuation. We recommend a "Buy" rating on the stock at the closing price of USD 42.31, down 2.01% as of March 07, 2022.

Three-Year Technical Price Chart (as on March 07, 2022). Source: REFINITIV, Analysis by Kalkine Group

Technical Analysis Summary:

Technical Indicators Defined: -

Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

Note 1: The reference data in this report has been partly sourced from REFINITIV.  

Note 2: Investment decision should be made depending on the investors’ appetite on upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the Valuation has been achieved and subject to the factors discussed above.