Citi is getting bullish on Beyond Meat even after its surge off last year’s lows.
Analysts at the firm upgraded the stock to a buy rating on Tuesday, arguing much of the bad news surrounding the company had already been priced in and that partnerships with McDonald’s and PepsiCo looked promising. Beyond initially surged on the call before reversing course and ultimately dropping into the close, falling more than 5%.
Todd Gordon, founder of TradingAnalysis.com, is more skeptical on the name.
“The momentum and the narrative is slowing,” Gordon told CNBC’s “Trading Nation” on Tuesday. “I think it’s going to be a challenge for Beyond Meat going forward despite the strong partnerships.”
Beyond Meat has rallied strongly, and is now up nearly 12% this year, compared to the S&P 500 which is up 3%. It has risen nearly 200% since last March.
“You can see the chart here to judge where you are,” said Gordon. “[There’s] downside support at about $130, but you need to break above $190 to get us going.”
The stock traded just below $140 on Tuesday.
Nancy Tengler, chief investment officer at Laffer Tengler Investments, agrees with Gordon’s call. She’s opting for a different food stock instead.
“I think the company has a lot of problems, and we’ll see how they do in terms of posturing and placing their partnerships, but I’d much rather own something like Chipotle,” Tengler said.
Chipotle finished flat on Tuesday and is up nearly 7% this year.
Disclosure: Tengler and Laffer Tengler Investments hold CMG.
