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Beyond Meat Price Target Up on McDonald's UK Deal

Piper Sandler lifts price target on Beyond Meat shares as the plant-based-meat company plans to launch a vegan cheeseburger in the U.K.

Beyond Meat  (BYND) - Get Beyond Meat, Inc. Report shares rose Tuesday after Piper Sandler analyst Michael Lavery lifted his share-price target for the plant-based-meat company to $178 from $130, affirming his rating at neutral.

Lavery noted a recent report in Vegan Food UK that the Chicago burger giant McDonald’s  (MCD) - Get McDonald's Corporation (MCD) Report is launching a vegan cheeseburger in the U.K. using Beyond Meat patties. The move presents a substantial revenue opportunity for Beyond Meat, the analyst said.

Beyond Meat shares recently traded at $185.35, up 5.6%. They have well more than doubled year to date. McDonald's shares were 0.6% higher at $227.35.

Morningstar analyst Rebecca Scheuneman has a mixed take on Beyond Meat. 

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“While inflation in various meat cuts could make Beyond’s products more attractive on the basis of price, encouraging adoption, we aren’t blind to the fact that about half of Beyond’s products are sold in the food-service channel, with two-thirds of that from hard-hit dine-in formats,” she wrote in an August commentary.

“While retail sales growth should remain robust, declines in food-service sales in 2020 should cause a deceleration in consolidated top-line growth.”

But “we’re still optimistic on the prospects for the meat-like plant-based-meat market, which provides a great option for omnivores seeking to consume more vegetables,” Scheuneman said.

"We model Beyond’s market share increasing from 2.5% in 2019 to 6.8% in 2029, as plant-based meats gain a larger share of the overall meat category, and as Beyond’s brand continues to win with consumers, given its strong performance in taste tests and ongoing research-and-development investments.”