The firm also cut the company's price target to $62 a share from $84. That's 3.4% downside from the stock's Wednesday closing price of $64.18.
The recent drop in the stock means that the "long-term risk/reward is more balanced at current levels," the firm said.
DA Davidson also reiterated its bull-case scenario, where the company gains more 10% of animal-meat market share in 10 years. DA Davidson said that scenario could generate more than $2.5 billion annually for Beyond Meat.
The pandemic hurts near-term sales and could call the company's overseas expansion plans, especially in China, into question, the firm said.
On the other hand, the talk about coronavirus being initially passed from animals to humans "could serve as a flashpoint in the discussion around plant-based protein in the longer term."
Last week, the company was downgraded at Goldman Sachs to sell from neutral, saying that investors will not want to pay a premium for the stock in the current environment.
The firm slashed its price target to $39 a share from $129.
Goldman analyst Adam Samuelson said customer-traffic declines represented a substantial near-term headwind for the company and its food-service distribution carried risk.
Year to date, Beyond Meat shares are down more than 20% after a sharp runup in 2019.
At last check Beyond Meat shares were trading down 7.7% at $59.25.