A heavy lesson for investors: Beyond Meat is ruined! The compassionate plant-based meat is playing people for suckers! The stock price is only 1 dollar.

In an era where inflationary pressures are soaring and household budgets are being constantly squeezed, if you walk into a supermarket and find that the price of real meat is actually cheaper than that of plant-based protein meat, which one would you choose for dinner? Such a scenario is a heavy blow for the phenomenon stock Beyond Meat (Nasdaq: BYND), which was once hailed as the “next consumer revolution.”

Beyond Meat went public on NASDAQ in 2019, receiving enthusiastic support upon its debut, with its stock skyrocketing by approximately 163%. It became a representative meme stock of the plant-based protein trend that year, quickly planting seeds among global consumers with its marketing strategies focused on vegetarianism, health, and environmentalism. With the backing of media and tech industry celebrities, the market for meat alternatives once showed rapid growth: in 2020, sales of meat substitutes reached approximately $1.3 billion. However, Beyond Meat is not just focused on making “alternative meat”; it emphasizes that “the taste should be like real meat” and “the experience should feel like eating meat.” Beyond Meat has established partnerships with several fast-food chains, bringing plant-based burgers and vegetarian steaks to familiar dining tables. However, recently, Beyond Meat has drastically undermined investor confidence, with its stock price hovering around one dollar, and analysts believe bankruptcy is not far off. This is purely market observation and not any investment advice.

Beyond Meat is completely ruined!

Beyond Meat (NASDAQ: BYND) has stagnated and is on the verge of hitting rock bottom, facing complete bankruptcy. In the most recent quarter, its revenue fell by 13% to $70 million. The company reported a loss of as much as $111 million, compared to $27 million in the same period last year. Revenue for this quarter is expected to be only $60 million. Once regarded as a promising company when it was founded in 2009, it is now on the brink of failure.

Is Beyond Meat about to go bankrupt after its sudden rise and fall?!

According to media reports, Beyond Meat President and CEO Ethan Brown made extremely inappropriate remarks. He stated that he is optimistic and excited about the future of Beyond Meat. However, what Beyond Meat has never acknowledged is that there is no longer a reason for Beyond Meat to exist. On July 26, 2019, the company’s stock price reached as high as $235, but now it barely exceeds $1.20. A recent report from the Food Institute claims that Beyond Meat is likely to go bankrupt by 2027, when its massive debts will come due. The institute wrote: Following the current trajectory, bondholders will take control of the company through bankruptcy proceedings.

At the end of last month, the company reached an agreement to restructure its finances through a convertible bond (Convertible Note). At that time, Reuters reported that the plant-based meat producer announced it had reached an early exchange agreement with bondholders, managing its debt through the issuance of new shares and bonds. Following the news, Beyond Meat's stock price immediately plummeted by 58%. Plant-based meat had a brief period of success. However, due to multiple reasons, its demand has rapidly declined, primarily due to high prices; additionally, the food is highly processed, and there are still significant differences in taste and texture compared to traditional meat. Although some still believe in the health benefits of vegetarianism and plant-based meat, this is not enough to restore investor confidence in the stock.

Why is this happening? The gap between ideals and reality.

Beyond Meat's story was originally filled with ideals: using technology and innovation to replace traditional meat and produce more environmentally friendly and healthier proteins. However, when this ideal had to confront real factors such as “consumer behavior,” “cost structure,” “price sensitivity,” “increased competition,” and “inflation,” cracks began to appear. Beyond Meat reminds us that the power of market narratives (Narrative) can sometimes outweigh fundamentals. Beyond Meat was once seen by the community as an “underrated revolutionary” or “the next big opportunity,” and such narratives ignited investors' emotions and resonance. But when the strength of the narrative weakens, or when reality re-emerges, the enthusiasm may backlash.

What should investors learn from the Beyond Meat case?

Distinguishing Narrative vs Fundamentals: When you see terms like “revolutionary,” “alternative,” and “next big thing” being wildly applied to a company, you should ask: Can revenue, profit, costs, and cash flow continue to support the story?

Beware of the meme effect in stock prices: Although Beyond Meat once became a favorite among retail investors, its volatility and the underlying community sentiment and short-selling mechanisms may not necessarily make it a reliable long-term investment.

Understanding the gap between innovation and market implementation: no matter how good the idea is, factors such as the market, costs, price sensitivity, and consumer habits can all become obstacles. The high costs and high pricing of alternative meat products is a typical example.

Researching Debt and Dilution Risks: Beyond Meat's debt-to-equity swaps and new share issuances have led to shareholder dilution. While these operations may provide a chance for “survival,” they serve as a significant warning for existing shareholders or potential investors.

This article is a heavy lesson for investors: Beyond Meat is ruined! The compassionate meat substitutes are just a way to harvest profits! The stock price is only 1 dollar, first appeared in Chain News ABMedia.