Off meat stocks’ gains as losses taper, analysts are turning cautiously optimistic

Vegan Protein Company beyond the meat (BYND) topped expectations for fourth-quarter results Friday morning. Beyond Meat stock rose after the results.

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Beyond meat gains

The El Segundo, California-based company reported a narrower-than-expected loss for the fourth quarter as sales fell for the third consecutive quarter. Beyond Meat reported a loss of $1.05 per share, an improvement from a loss of $1.27 per share a year ago. Revenue fell 20.6% to $79.9 million. Sales averaged about a 15% decline over the past three quarters.

However, the results were better than analyst expectations with a loss of $1.18 per share on $75.8 million in sales.

On the earnings call, CEO and founder Ethan Brown said the fourth quarter ended “a challenging year for our business and our category, a year characterized by persistently high inflation and consumer-to-protein trading, slowing economies in key markets, and increased competitive activity.”

Beyond Meat reported a 16.9% decrease in total pounds of product sold, and a 4.4% decrease in net revenue per pound. The company’s US retail revenue fell 17.1%, driven by a 22.5% drop in pounds sold.

For fiscal year 2023, Beyond Meat expects revenue to be between $375 million and $415 million, which is down 1% to 10% from 2023. It expects low double-digit gross margins to increase sequentially through the year. Beyond Meat expects cash flow to be positive during the second half of 2023.

BYND Stock

Beyond Meat stock rose more than 10% to 18.88 Friday, after rising nearly 19% after earnings results. After Friday’s gains, BYND stock is up 2% last month, and nearly 53.4% ​​year-to-date. On Friday, the shares closed just under 9% of the stock’s 200-day moving average.

Bernstein raised its price target for Beyond Meat to 18 from 10 and maintained its Market Perform rating. Analyst Alexia Howard called the results “another cautiously more positive quarter, although the company is in no way out of the woods yet.”

Mizuho boosted its target to 20, from 11. It maintained the stock’s rating at neutral, but plans for fiscal 2023 include a strategy reversal more capable of building a foundation for multiyear revenue growth, the note said.

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