Beyond Meat's Stock Surges in Meme-Stock Rally

Strategic Insights -

The stock of Beyond Meat, a beleaguered company, has surged in recent days, fueled by social media buzz and echoes of past meme-stock frenzies. The shares have doubled in value and extended a four-day climb of over 1,000 percent, drawing comparisons to periodic meme-stock rallies that have disrupted markets in recent years. The momentum started building late last week, as large volumes of purchases pushed the stock price up, and traders egged each other on in Reddit boards and YouTube comments. The company's growth has slowed in recent years, as consumers have traded pricier plant-based meat for less expensive animal meat, and analysts have wondered if the company has reached the maximum number of consumers willing to try or purchase faux burgers and sausage.

Key Takeaways:

  • Beyond Meat's stock has surged by over 1,000 percent in four days, with shares doubling in value on Wednesday.
  • The company's growth has slowed in recent years, with consumers opting for less expensive animal meat over pricier plant-based options.
  • Two-thirds of analysts covering the stock rate it a "sell" according to FactSet.
  • The stock's recent rally has drawn comparisons to the infamous GameStop rally of 2021 and the periodic meme-stock rallies that have disrupted markets.
  • The number of comments on Reddit about Beyond Meat's stock have exploded this month, from a handful per day to several hundred in the past three days.
  • A Dubai-based trader, known as "Capybara Stocks" on social media, has been at the forefront of the push to buy Beyond Meat's shares.
  • The company's share price is down about 97 percent from its record high of around $14 billion in 2019.
  • The stock's current price is around $50 per share, despite the company's loss-making status.
  • The tumbling share price made Beyond Meat a favorite target of short sellers, who sell borrowed stock in hopes of buying it back at a lower price later and pocketing the profit.

Statistics:

  • 1,000 percent - the four-day climb of Beyond Meat's stock price
  • 2/3 - the proportion of analysts rating the stock a "sell" according to FactSet
  • 97% - the decrease in Beyond Meat's stock price from its record high
  • $14 billion - the value of Beyond Meat in 2019
  • $50 per share - the current price of Beyond Meat stock
  • Several hundred - the number of comments on Reddit about Beyond Meat's stock per day

Sources:

  • The New York Times
  • FactSet
  • Breakout Point (firm that tracks retail investing trends)
  • Reddit (for comments on Beyond Meat's stock)
  • Social media (for comments and activity related to Beyond Meat's stock)