Beyond Meat (BYND) - Get Report shares traded lower Friday after analysts at JPMorgan lowered their rating on the plant-based food group amid concern that the stock's recent rally is 'not supported by fundamentals."
JPMorgan analysts Ken Goldman cut his rating on Beyond Meat to 'underweight' from 'neutral', with a price target of $122 per share, following a six-month rally for the El Segundo, California-based group that has lifted its share price by more than 190%, a move Goldman said was "above and beyond what we consider rational even for a good company like Beyond Meat".
Goldman also noted that "sluggish fundamentals" for the plant-based food group, as well as intensifying competition from rivals such as Impossible Foods and a hesitancy from some restaurants to add its products to menus amid the coronavirus pandemic have made him wary of the stock's lofty valuation.
Beyond Meat shares were marked 3.3% lower in early trading following the JPMorgan note to change hands at $152.32 each, a move that would peg that stock at more than double the level it was trading on New Year's Eve.
Last month, Beyond Meat reported a second quarter loss of $10.2 million as the cost of re-routing its burgers and sausages from restaurants to retail outlets during the peak of the coronavirus pandemic ate into its bottom line.
Overall sales, however, rose 70% from last year to $113.3 million thanks in part to a tripling of U.S. revenues, which it $90 million, and a near doubling of its overseas sales, which came in just under $10 million.