Beyond Meat (BYND) was climbing 5.4% to $84.07 Tuesday after a Bernstein analyst upgraded the plant-based-food maker to outperform from market perform, calling the shares cheap.

Analyst Alexia Howard, who affirmed her price target at $106, said in a note to investors that she making a "straightforward valuation call," with the shares down 66% from their peak.

While selling pressure is likely to persist near term, Howard said, her fair-value estimate is based on multiples awarded to other high-growth consumer peers. And she suggested that the downside for the shares is limited.

Howard said the company should trade at eight to 10 times enterprise value to sales, which would indicate a fair-value range of $84 to $130.

The key is whether the company can partner with McDonald's (MCD - Get Report) , which is doing trials of a Beyond Meat burger at 28 restaurants in Canada, Howard said.

While the feedback on the Beyond P.L.T. (plant, lettuce, tomato) burger being tested has been positive, the product doesn't yet appear to be a "blowout success" that "justifies an immediate nationwide rollout across both Canada and the U.S.," Howard said. She assumes the probability of such a move materializing at 50%.

Denny's (DENN - Get Report) also recently announced a partnership with Beyond Meat, making a plant-based burger available at all Los Angeles-area locations.

Last week, Beyond Meat, El Segundo, Calif., reported a profit of 6 cents a share on revenue of $92 million. Analysts surveyed by FactSet were expecting earnings of 3 cents a share on revenue of $82.2 million.

Beyond Meat also offered 2019 revenue guidance between $265 million and $275 million, up from its previous estimate of $240 million. Analysts were expecting $264.4 million.

The 10-year-old company went public in late May at $25 a share.