What to Expect From Beyond Meat’s First Results Since IPO
What to Expect From Beyond Meat’s First Results Since IPO
(Bloomberg) -- The year’s best performing initial public offering will test its roughly 300% run-up on Thursday, when Beyond Meat Inc. gives its first financial report as a public company.
The maker of plant-based meat alternatives included preliminary first quarter results in its IPO prospectus, but Wall Street still has plenty to watch for after the market closes. Plans to expand capacity in Europe and the possibility of the firm’s first full-year guidance will both be focal points for investors, Bernstein analyst Alexia Howard wrote in a note this week.
With shares trading at nearly quadruple last month’s IPO price, the stock looks like a potential powder keg. Short interest represents more than half of its public float, according to to financial analytics firm S3 Partners. Options trading implies about a 13% move after the report.
Beyond Meat launched in Europe less than a year ago and is aiming to establish production capabilities on the continent in 2020. The IPO filing disclosed “strong expressions of interest” from some of Europe’s largest grocery and restaurant chains, plus a years-long effort to generate brand awareness in Hong Kong.
This is all part of Beyond Meat’s need to articulate a clear vision on how it will evolve to stay in-step with investor’s lofty expectations, Bloomberg Intelligence analyst Jennifer Bartashus said in an interview.
"One of the challenges Beyond Meat will face over the next year is balancing investments needed to drive sales and consumer adoption with improving the company’s profitability outlook," she said.
A 2019 sales forecast above the Bloomberg consensus estimate of $205 million could help shares extend their massive runup. But those calling for a correction in the stock could be proven correct if threats like increased competition take over the narrative. Food giants like Tyson Foods Inc. and Nestle SA are working on competing products as smaller rival Impossible Foods Inc. continues to grow its war chest.
Just the Numbers
- Prelim. 1Q sales $38.0m-$40.0m (May 3), est. $38.9m (range $38.1m-$40.0m)
- Prelim. 1Q loss from operations $6.7m to $7.7m, est. loss $7.6m (loss range $8.4m-$7.0m)
- Prelim. 1Q gross profit $9.5m-$10.5m
- FY 2019 Adj. loss/share est. 40c (loss range 72c-18c)
- FY 2019 sales est. $205.0m (range $192.0m-$232.0m)
DATA
- Stock has 2 buys, 7 holds, 0 sells
- Average price target $71.34
TIMING
- Earnings release expected June 6 after market close
- Call June 6 at 4:30pm, 866-221-1171 pin 6892534
--With assistance from Gregory Calderone.
To contact the reporter on this story: Drew Singer in New York at dsinger28@bloomberg.net
To contact the editors responsible for this story: Brad Olesen at bolesen3@bloomberg.net, Morwenna Coniam
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