Beyond Meat Inc.
BYND,
-0.11%

is scheduled to report third-quarter earnings on Monday amid a competitive landscape that seems to grow more crowded by the day.

Over the past couple of months, Beyond Meat has announced a flurry of news including a partnership for plant-based Jamaican patties to be sold at Golden Krust; the launch of Beyond Breakfast Sausage Links at grocery stores across the country; and increased grocery distribution of Beyond Breakfast Sausage Patties at retailers like Kroger Co.
KR,
+1.37%
,
Walmart Inc.
WMT,
+1.60%

and Publix.

Beyond Meat’s biggest competitor, Impossible Foods, has made news as well with expanded distribution, additional funding and more.

Read: Papa John’s CEO says the company has added more than 8 million new customers this year

And other plant-based protein and meat alternative companies are making a ton of their own announcements. Planterra Foods’ plant-based brand Ozo launched with help from Jesse Tyler Ferguson, one of the stars of the TV show “Modern Family.”

Plant-based egg makers Just Egg expanded in Asia, a region where
both Beyond Meat and Impossible Foods have been making inroads.

And Prime Roots, which makes plant-based meat and seafood, is now available at retailers including Amazon.com Inc.’s
AMZN,
-0.32%

Whole Foods Market.

UBS analysts highlight Nielsen data shows that Beyond Meat sales were up 58% for the 13 weeks ending Sept. 28. However, food service is under pressure due to the coronavirus. And Beyond Meat has been bringing the price of its products down in order to compete with traditional animal protein.

“Management has consistently messaged that it would use
gross margin upside to invest in price,” UBS analysts led by Erika Jackson
wrote in a Friday note. “The debate is whether this seemingly aggressive
pricing was all strategic, or whether there was (or will be) a marketplace
component given increased competition in Beyond Meat’s key categories.”

UBS rates Beyond Meat stock sell with a $110 price target.

In an earlier UBS note focused on some of the risks Beyond Meat faces.

See: Coronavirus is driving a new generation of home cooks to Kraft Heinz products

“We believe increased competition from branded peers and
private label (especially in a recession) pose a threat to Beyond Meat, and as
plant-based meat trial and retention growth slow, it may be difficult for
Beyond Meat to grow its valuation.”

CFRA also expressed its own margin concerns.

“Beyond Meat has been focused on lowering its products’
price point to eventually reach price parity with conventional animal meat,
which we believe will eat into margins this quarter,” wrote Arun Sundaram.

CFRA says Beyond Meat’s U.S. food-service sales in the second quarter were down dramatically, more than 70%. Though there has been some recovery, CFRA says that could plateau as cold weather sets in and coronavirus cases surge.

“Larger, quick-service restaurants historically represented one-third of Beyond Meat’s food-service sales, while the remaining two-thirds consisted of smaller restaurants, including independent restaurants and mom-and-pop shops,” CFRA said.

“It could take a very long time before independent
restaurants and mom-and-pop shops fully recover from Covid-19. This puts more
pressure on Beyond Meat to gain new customers.”

Beyond Meat has an average hold rating and average target
price of $129.21, according to 22 analysts polled by FactSet.

Here’s what else to watch for when Beyond Meat reports:

Earnings: Analysts polled by FactSet are expecting earnings per share of 5 cents, down from 6 cents last year.

Estimize, which crowdsources estimates from sell-side and
buy-side analysts, hedge-fund managers, executives, academics and others,
expects EPS of 7 cents.

Revenue: FactSet analysts expect revenue of $137.0 million, up from $92 million last year.

Estimize forecasts revenue of $136.4 million.

Stock price: Beyond Meat shares have more than doubled, up 107.5% for the year to date.

The benchmark S&P 500 index
SPX,
-0.02%

is up 8.6% for the period.

Also: Noodles & Co. CEO says there’s an ‘opportunity for growth’ as pre-COVID trends accelerate

Other items:

-Large food companies like Kellogg Co.
K,
+0.07%

and Tyson Foods Inc.
TSN,
-0.65%

are also making a play for plant-based market share.

“We keep a hold [stock rating] due to weakening trends in
some key markets/categories but are optimistic of Kellogg’s long-term growth
potential, especially in nascent categories like plant-based meat where Kellogg’s
Incogmeato brand was launched this quarter under the halo of the well-known
Morningstar Farms brand,” wrote CFRA in a late October note.

CFRA has a $68 price target on Kellogg shares.

Kellogg reported third-quarter earnings last week.

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-Demand for plant-based foods is expanding to include not
just meat and fish, but plant-based cheese, yogurt, ice cream and butter,
according to research from ADM, a company that specializing in food
ingredients, animal and human nutrition, and other areas of food and farming.

ADM says protein fermentation, 3D printing and other
technologies will also play a role in plant-based innovations.



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