Shares of Beyond Meat (NASDAQ: BYND) had a rough session on Tuesday after the stock was downgraded to a neutral rating from overweight by J.P. Morgan analyst Ken Goldman.
News of the downgrade sent shares in the alternative meat company down 20% in the morning session. The analyst cited concerns that BYND is too expensive, and maintained his price target for the stock at $120.
“We are downgrading the BYND shares to Neutral from Overweight. When we raised our price target to $120 from $97 last Friday morning, the shares most recently traded at $99.50; yesterday they closed at $168.10, a +69% move in two days (SPX +2%),” Goldman said in a notice to clients according to CNBC.
“As we wrote last week, “At some point, the extraordinary revenue and profit potential embedded in BYND… will be priced in” – we think this day has arrived. Our above-the-Street estimates remain unchanged and our price target is more-or-less the same (up $1 merely to reflect lower rates – we value BYND via a DCF). In other words, this downgrade is purely a valuation call,” he added.
JPMorgan Chase (NYSE: JPM) helped underwrite Beyond Meat’s initial public offering last month. The stock tumbled 12% to $146 at the start of regular trading Tuesday following the downgrade.
As of 1:05 p.m. ET, the shares lost $35.60 or 21.18% to $132.50 apiece. Nonetheless, the stock is still trading more than 450% above its initial public offering price of $25 apiece.
Beyond Meat stock had gained over 600% since making its Wall Street debut through Monday. According S3 Partners data cited by CNBC, short sellers betting against the stock lost close to $400 million through last Friday.
Beyond Meat Inc Profile
Beyond Meat Inc is a food company based in the United States. It offers a portfolio of revolutionary plant-based meats.
The company has developed three core plant-based product platforms including beef, pork and poultry. Its flagship product is The Beyond Burger, is designed to look, cook and taste like traditional ground beef.
It generates revenues primarily from sales of its products, including The Beyond Burger, Beyond Sausage, Beyond Chicken and other plant-based meat products.
Its customers include mainstream grocery, mass merchandiser and natural retailers, as well as restaurants and other foodservice outlets mainly in the United States.