Lavery cut his share-price target on Beyond Meat to $125 from $144 and said he was concerned about retail demand.
“Current retail momentum lags consensus expectations” for the fourth quarter, and earnings estimates for 2021 are at risk, he wrote in a commentary. Data indicate “another quarter of under-shipments,” Lavery said.
The stock traded Wednesday at $122.78, down 2.61%. Beyond Meat , has soared 67% over the past year amid enthusiasm for health food.
There’s plenty of room for competition in the space, Lavery said, according to Bloomberg.
“New entrants can both validate the category with consumers and help build broader visibility,” he said.
Beyond Meat has a “real” opportunity at McDonald’s, but that’s not providing great brand visibility, he said.
Morningstar analyst Rebecca Scheuneman is cautiously bullish on Beyond Meat, putting fair value at $146.
“Given the rapidly changing marketplace, we think it is too early to tell if Beyond’s first-mover advantage will result in a sustained market leadership position," she wrote last month. "Until we have better visibility on the strength and durability of Beyond’s brand, we don’t assign Beyond a moat.”
But, “we’re still optimistic on the prospects for the meat-like PBM market,” Scheuneman said. “We expect a primary growth driver to be the 20% of consumers willing to adjust their habits to benefit the environment. Beyond’s products emit 90% less greenhouse gases, require 93% less land, 99% less water, and 46% less energy to produce than their meat equivalents.”