Shares hit an all-time low on Monday, falling for a fifth straight day and dragging down other plant-based stocks as inflation has driven consumers away from higher-priced products.
(ticker: BYND) has seen better days. In fact, the stock is down 74% this year and a whopping 93% from its all-time closing high of $234.90 in July 2019, according to Dow Jones market data.
On Monday, Beyond Meat stock fell 5.6% to $17.26. It launched at $25 in May 2019. Other plant-based companies like
they fell 2% and 0.6% on Monday, and are down 63% and 18% this year.
So what’s going on in the world of plant-based meats? One word: inflation.
Beyond Meat reported second-quarter results in early August. Not only did the company post bigger losses and revenue below what analysts expected, but it also gave a downbeat outlook for the full year due to inflationary pressures on its consumers.
“The second quarter of 2022 saw a sequential contraction in the penetration of plant-based meats in US households for the first time in more than four years,” Beyond Meat CEO Ethan Brown said on the company’s latest earnings conference call. “As consumers explicitly look for value, we believe that high inflation and the industry’s premium pricing relative to animal protein is largely, if not entirely, a factor.”
And it doesn’t look like inflation is going to abate anytime soon. Consumer prices rose at an annual rate of 8.3% in August, according to the Labor Department. Leading the charge for high prices were the shelter, food and medical care categories, which posted some of the fastest price gains during the month. Specifically, food costs have jumped 11.4% over the past year, the biggest 12-month jump since May 1979.
Not only are food prices high in general, but Beyond Meat products are more expensive overall than regular animal products. CEO Brown said last month that the average retail price of ground beef was $4.90 a pound, while Beyond Meat’s ground beef was about $8.35 a pound.
“This is a very difficult proposition when consumers have very high levels of inflation going on and their purchasing power at the grocery store is declining,” Brown said.
Write to Angela Palumbo at firstname.lastname@example.org