More than meat
stocks hit an all-time low on Monday, falling for the fifth straight day and dragging other vegetable stocks down as inflation has led consumers to avoid higher-end products.
More than meat
(ticker: BYND) has seen better days. In fact, according to Dow Jones Market Data, the stock has fallen 74% this year and a whopping 93% from its all-time high of $234.90 in July 2019.
On Monday, Beyond Meat shares fell 5.6% to $17.26. It went public in May 2019 for $25. Other plant-based companies like:
fell 2% and 0.6% on Monday and is down 63% and 18% this year.
So what’s happening in the plant-based meat world? One word: inflation.
Beyond Meat announced its second quarter results in early August. The company not only posted a bigger loss and lower revenue than analysts had expected, it also painted a bleak picture for the full year as inflationary pressures on its consumers.
“The second quarter of 2022 saw a sequential contraction in plant meat penetration by US households for the first time in more than four years,” said Ethan Brown, chief executive of Beyond Meat, during the latest earnings conference call. Company. “Because consumers are expressly seeking value, we believe that the industry’s high inflation and premium prices relative to animal protein are largely, if not completely, a determinant.”
And it doesn’t look like inflation will go away anytime soon. According to the Ministry of Labor, consumer prices rose 8.3% year-on-year in August. The top prize for high prices was the housing, food and medical categories, which saw some of the fastest price increases in the past month. In particular, the cost of food has increased by 11.4% in the past year, which is the biggest jump in 12 months since May 1979.
Not only are food prices high across the board, but Beyond Meat’s products are generally more expensive than regular animal products. CEO Brown said last month that the average selling price of ground beef was $4.90 a pound, while Beyond Meat’s ground beef cost about $8.35 a pound.
“That’s a very difficult proposition when consumers have very high inflation and their purchasing power at the supermarket is declining,” Brown said.
Write to Angela Palumbo at firstname.lastname@example.org