Shares of Beyond Meat were down 10% at the open today after Benjamin Theurer, an analyst at Barclays bank downgraded the stock’s rating by two tiers. Theurer downgraded the company from an overweight (buy) rating to an underweight (sell) rating skipping the ‘hold’ rating citing the firm’s significant exposure to the foodservice market segment.
In a note to investors, he explained that Beyond Meat generates almost 50% of its revenues from the foodservice channels, which might not see a full recovery until 2021, hence, posing a significant downside risk to the company.
Beyond Meat share price gap down today
However, not everyone sees a bleak future for Beyond Meat with one of its biggest fans being CNBC’s Mad Money host, Jim Cramer, who has frequently warned investors against betting on the company’s demise.
Cramer today revealed that the partnership between Beyond Meat and McDonald’s was not over yet despite the poor results seen during the pilot project in Canada. Therefore, we could see the two firms announced a new improved partnership based on their initial results given that they have the capital to do the same.
It is clear that meat alternatives have become very popular among millennials and other young people who make up a significant portion of the population. We will see this trend growing as young people move into work positions that pay well over the years and this will be reflected in their purchasing decisions.
Well, only time will tell how Beyond Meat stock will perform over the second half of this year.