Why Is Beyond Meat's Stock Crashing?

Beyond Meat (NASDAQ:BYND) stock has been struggling mightily since hitting a peak of $221 on Jan. 26. As of Friday's close, shares of the food manufacturer were trading at about half that price -- $110.72. There are a few reasons investors can point to as to why the stock has been struggling of late.

First, is the general softness in growth stocks since February. Investors have been taking a second look at high-valued stocks after the GameStop (NYSE:GME) craze that took place in late January. A great example of the bearishness is ARK Innovation ETF (NYSE Arca: ARKK) falling 23% since then. But Beyond's losses have been even more emphatic – declining nearly 40% during that time.

Another reason is that Beyond's business has been struggling amid the pandemic and restaurants shutting down. In the fourth quarter, its net revenue rose by a modest 3.5% from the prior-year period. And in the first-quarter results that Beyond released last week, sales were up 11% year over year. While that's an improvement, it's not likely enough to get investors excited or bullish.

A third reason the stock is suffering is news that Tyson Foods (NYSE:TSN) has launched vegan burger that could wrestle away market share from Beyond. With growing competition, there is the danger that Beyond's high-growth days may be long gone.

However, with Beyond announcing a global agreement with McDonald's (NYSE:MCD) in February, there could be plenty of potential growth still left for Beyond. And with its shares trading near their 52-week low, now could be an optimal time for investors to add this food stock to their portfolios.