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Beyond Meat on the menu for short sellers

The Market Intelligence Platform


Beyond Meat on the menu for short sellers

Beyond Meat Inc. is one of the standout stock market stories of 2019. Since listing on the Nasdaq on May 1 at $25 per share, the meat alternatives maker has seen wild price swings but now trades almost 500% higher.

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Source: Beyond Meat

Many investors have been drawn in by the company's pitch of providing a healthier and more sustainable option to burgers, sausages and other meat products. The trend has attracted the attention of fast food chains, grocers and food processors alike.

Yet it appears there is a growing rank of sceptics, too. Our story this week shows that just under 10% of Beyond Meat's stock is out on loan to short sellers, placing it among the most shorted of 2019 IPOs. According to financial analytics firm S3 Partners, Beyond Meat has the highest borrow fee of all U.S. stocks so far this year.

Despite its rapid ascent as a publicly traded equity, Beyond Meat's balance sheet remains more akin to that of a venture capital bet. In late July it reported a 287% increase in second quarter sales to $67.3 million but recorded a GAAP net loss of $9.44 million that was worse than analysts had anticipated. Since then its share price has slumped from $234.90 to about $145 — still a hefty premium to its IPO price. But with such volatility, short-seller interest is likely to remain a feature of the Beyond Meat story for some time.

Chart of the week: Share price performance of US restaurants

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Automotive

SUVs help automakers cross rough financial terrain

SUVs have knocked sedans off the top spot for auto market share, delivering a welcome profit boost for manufacturers as consumers pay a premium for cars that cost marginally more to make.

CFO: GM's restructuring plan to save $4.5B through 2020

The automaker's plan included layoffs, plant closures and cutting car production to better focus on electric and autonomous vehicles.

Retail

How Amazon could combat ongoing trade war with China

The e-commerce giant is likely working to help its third-party merchants, whose sales account for more than 50% of goods sold on its e-commerce platform.

Alibaba taps growth in China on trade war uncertainties

Alibaba beat analysts' expectations in its fiscal first quarter earnings despite market turmoil. The Chinese e-commerce retailer will continue to focus on its domestic-driven business to drive growth.

Walmart CFO: Raised guidance for fiscal FY'20 factors in tariff impact

The retailer has "thoughtfully" managed pricing and margins in the past months and will continue to deploy strategies to mitigate the impact of the tariffs, said Walmart's CFO and Executive Vice President Brett Biggs.

JD.com to invest in lower-tier cities after logistics breaks even

Spurred by growth in its longtime loss-making logistics business, Chinese e-commerce retailer JD.com is planning more investment into this unit in addition to growing its user base in lower-tier cities.

CEO: Proposed tariffs could impact Macy's FY'19 EPS outlook

The department store retailer is not planning on raising prices if additional tariffs are enacted at a 10% rate, executives said Aug. 14.

Food, Beverage & Tobacco

Short sellers circling Beyond Meat after IPO

Beyond Meat is among the most shorted stocks of all the companies to have gone public in 2019.

Dining out: US restaurant sales continue summer simmer in July

Consumers continue to spend on dining out despite growing worries among some over a possible recession.

Sysco lowers FY'20 operating income target as US customers look elsewhere

The food service provider pointed to rivals' lower prices as the reason for losing both national and local customers in the U.S.

Food in Focus: Rising wholesale prices squeeze grocer margins in July

Supplier prices for grains and vegetables increased the fastest during the month, according to federal data.

FDA proposes adding graphic warnings to cigarette packs

Proposed graphic warnings would depict the negative consequences of smoking.

Consumer Edge is a weekly collection of critical developments across the automotive; retail; and food, beverage, and tobacco industries. Drawing on exclusive analysis and value-added content from the Consumer News team at S&P Global Market Intelligence, it is published every Thursday.