Beyond Meat, which has yet to turn an annual profit , may have to cut prices to match a move by plant-based meat rival Impossible Foods.
Michael Loccisano/Getty Images for Food Bank for New York City
Beyond Meat stock is lower early Tuesday, following news that rival Impossible Foods introduced another price cut.
Privately held Impossible Foods plans to lower the price of its plant-based patties by 20% at grocery stores in the U.S. That means that the suggested retail price of an Impossible Burger would be $5.49 in thousands of grocery stores across the country, with similarly planned price cuts for other markets, from Canada to Hong Kong.
The move is part of a longer-term plan to achieve price parity with ground-beef prices. In the first week of the year, Impossible Foods announced what was then its second price cut in a year, bringing the price of a patty to $6.80. While the most recent move gets the company closer to its goal, it’s still roughly double the cost of a $2-to-$3 beef patty.
Faux-meat players Beyond Meat (ticker: BYND) and Impossible Foods have been steadily increasing their presence in supermarkets and other retailers. That’s been especially true during the pandemic, when fewer people were trying their products at restaurants, and a renewed focus on health led many consumers to investigate plant-based diets.
Yet at the same time, it’s been difficult for Beyond Meat to keep up with lofty sales expectations. In addition, the company has yet to turn an annual profit, notching just two profitable quarters since its initial public offering in 2019. Analysts expect that to change this year, but if the company is forced to cut its own prices, to match Impossible Foods, that could weigh on results.
Beyond Meat stock is down 4.6% to $169.87 in recent trading.
The shares have gained more than 42% since the start of the year, and while it’s long been a Wall Street darling, the most recent move may also be related to the short squeeze that’s swept up a number of consumer stocks lately.
Write to Teresa Rivas at [email protected]
