Beyond Meat downgraded on concerns that the soaring stock doesn’t take restaurant exposure and competition into account

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Beyond Meat Inc. BYND, -8.41% was downgraded to sell from neutral at UBS on concerns that the soaring stock price doesn’t take into account the headwinds the plant-based protein company faces. Beyond Meat shares have rallied more than 69% over the past month. UBS says the stock is the best performer under its coverage. Analysts are concerned that 51% of Beyond Meat’s sales are in the foodservice category, which has taken a big hit during the COVID-19 pandemic. Many independent businesses may not survive the outbreak, and national chains may not see sales bounce back as quickly as some may think due to the skyrocketing unemployment rate, UBS said. Moreover, Beyond Meat is facing more competition from Impossible Foods, which announced recently that its namesake burgers will be available at hundreds of new grocers, and big food producers, like Kellogg Co. K, +1.56%, which has introduced new Incogmeato products and plans to launch more. Starbucks Corp. SBUX, +2.85% announced last week that it is launching plant-based food and beverages in China through a partnership with Beyond Meat and other companies, marking Beyond Meat’s entrance into the China market. Beyond Meat stock has rallied more than 48% for the year to date while the S&P 500 index SPX, +1.47% is down 11.5% for the period.

Originally Published on MarketWatch

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