Under the current market volatility, it’s no surprise to see that Beyond Meat has come under immense pressure. On Thursday, shares fell further, dipping 5% after Goldman Sachs analysts downgraded the stock. That’s better than the 9.2% loss shares were sporting earlier in the day.
The analysts cut the stock to sell from a neutral rating, arguing that investors will not want to pay a premium for the stock in the current environment. Goldman Sachs also slashed its price target considerably, down to $39 from $129.
Let’s take a closer look at the charts.
Trading Beyond Meat
The one-year chart above is pretty wild, showing Beyond Meat’s explosive rally after going public in May. The stock has a 52-week high just shy of $240 and a 52-week low of $45. Goldman’s price target implies that shares will trade through those 52-week lows.
As you can see on the chart, shares are being rejected by the $70 to $75 area. The stock struggled with this area on Wednesday as well. This zone was notable support in November and December, but it’s not the first time we’ve seen support turn to resistance in Beyond Meat.
Check out the $135 to $140 area, which was support in the second and third quarter of 2019. Once this level gave way, it turned to resistance in the first quarter of 2020. This development is shown via purple arrows on the chart.
That’s not to say Beyond Meat stock can’t reclaim the $75 area, just that at this moment, it appears to be resistance. So what now?
On the plus side, BYND stock has reclaimed current downtrend resistance (blue line). The downside is obviously that prior support has turned to resistance. If the stock can reclaim $75, a move to the 100-day and 50-day moving averages in play, near $90 and $100, respectively.
If the stock can’t reclaim $75 and falls back below prior downtrend support, the lows near $50 are in play. If the stock doesn’t get a bounce here, the 52-week low at $45 is on the table, followed by Goldman Sachs’ new $39 target.