In this file:
· Beyond Meat founder: Our plant-based meat is on its way to being cheaper than animal protein
· Beyond Meat stock falls after double downgrade at Barclays
Beyond Meat founder: Our plant-based meat is on its way to being cheaper than animal protein
Brian Sozzi, Yahoo Finance
June 29, 2020
One thing is abundantly clear when this writer caught up via phone with Beyond Meat (BYND) founder and CEO Ethan Brown this past Friday night: He has a lot cooking on his grille this summer.
Some Peloton rides through the majestic streets of Italy (hey, not everyone takes Peloton’s live classes). Taking his daughter to kickboxing classes. And you know, the not so small task of being the driving force behind a relatively young plant-based meat juggernaut that is closing in on a $10 billion market cap just over a year since its IPO.
On any given day Brown’s responsibilities include: (1) scouting out terrain to build new manufacturing capacity; (2) signing fresh distribution deals with fast-food companies; (3) giving the green light on products like the new spicy BBQ cheeseburger at Carl’s Jr. using the Beyond Meat patty; (4) thinking of ways to lower the price of the company’s meat (he has done that this summer via new value packs at Target and Walmart; and (5) refuting misguided stories on his company’s relationship with McDonald’s (Brown continues to view working with McDonald’s as very important and Beyond’s relationship with the Golden Arches is just fine and dandy after a recent product trial in Canada ended as planned).
Maybe he even manages to check the stock price once or twice a week on the Yahoo Finance app (the stock is up 90% year-to-date, in case you are wondering). Brown won’t say that he does, at least to me — so we are just assuming.
And oh, all of this — perhaps collectively happening daily in some form or another — is going down during a major global health pandemic in COVID-19.
Like we said, all in a day’s work for the 6 foot 5 48-year-old.
Yahoo Finance talked at length with Brown about the road that lays ahead for Beyond Meat this year. What follows is an edited and condensed version of our chat.
Brian Sozzi: You told me back in May about some new value packs you were debuting. They are now in stores. I know lowering the price of your meat to drive accessibility and more volume is important to you. What has the response been like?
Ethan Brown: We set this goal 18 months ago that in five years we would be able to underprice animal protein in certain categories, and we feel that we're well on our way to doing that. This summer, as COVID-19 led to some disruption in the animal protein markets we felt that we had an opportunity to hold our breath, lean in and adjust our pricing so that it was much closer to that of traditional meat patties. And so with the value pack we are basically $15.99 now for 10 burgers. Some are offering it in some grocery stores at $14.99. So, we are within the price for beef. It keeps changing, but we are within the price of roughly 20% of the beef patties in the supermarket today.
Obviously we are signaling that you can get really close to parity with beef. Once we start to hit scale, you'll see the direct material and direct labor benefits of that as we push more volume through our facilities and are able to integrate much more production. But there's no material obstacle to us being able to, over the long run, under-price animal protein, we just need to keep working on it.
Sozzi: You actually think you can make your meat cheaper than traditional meat? ...
Beyond Meat stock falls after double downgrade at Barclays
By Emily Bary, MarketWatch
June 29, 2020
Shares of Beyond Meat Inc. are down 2.5% in premarket trading Monday after Barclays analyst Benjamin Theurer lowered his rating on the stock by two notches, to underweight from overweight.
Theurer is worried about "short- to medium-term headwinds" for the maker of plant based meat, especially given that some foodservice channels have been disrupted due to the COVID-19 crisis.
"Prior to the COVID-19 outbreak, Beyond Meat has been increasing its exposure to the foodservice channel, reaching levels closer to 50% of sales," he wrote in a note to clients. "The latter, in our view, poses downside risk in the short to medium term as a full foodservice recovery might not take place until 2021."
Theurer wrote that the company has higher exposure to the foodservice space internationally and ended a test in some Canadian McDonald's Corp. locations after what he said was "scarce feedback" that was "weaker than expected."
He upped his price target...
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