Beyond Meat’s (NASDAQ:BYND) stock cratered Thursday as Wall Street voiced doubts over the company’s growth prospects.
The plant-based meat maker reported disappointing third-quarter results after the bell on Wednesday. Its loss was wider than expected, while revenue fell short of expectations, even after a warning from the company last month. Beyond also issued a gloomy outlook that indicated sales wouldn’t snap back immediately.
Jefferies called it "the quarter that likely broke the camel’s back." Bernstein analyst Alexia Howard downgraded the stock, telling investors to not buy the dip.
"We view the results as further evidence that Beyond’s business is reaching market saturation faster than expected and that the company has deeper problems that won’t be easy to fix," Credit Suisse analyst Robert Moskow wrote in a note.
Beyond blamed a number of factors for its weak quarter, including severe weather, the delta variant and restaurants’ labor challenges. CEO Ethan Brown told investors that the problems were largely short term.
However, analysts are more skeptical. J.P. Morgan’s (NYSE:JPM) Ken Goldman quoted Maple Leaf Foods (TSX:MFI) CEO Michael McCain, who told investors last week that the company is seeing a "marked slowdown" in the plant-based protein category, which could suggest a shift from the high growth rates expected by the industry.
"We are not yet sure who is right – Beyond Meat or Maple Leaf Foods – but when we hear commentary like this, it’s hard to be completely confident about the future of the category," Goldman wrote.
BYND shares stumbled $15.21, or 16.1%, to $79.26.
