“Although Beyond Meat may be a very interesting company, as an investor, you still need to add a little 'animal fat' to the stock portfolio.” A fund manager who questioned Beyond Meat, the first man of artificial meat, said .
Contrary to the “health and environmental protection” philosophy advocated by Beyond Meat, the term “animal fat” has become the “secret” of Wall Street institutions shorting Beyond Meat.
Beyond Meat is the most popular new stock in the US stock market. On the 14th, the stock rose 14.65% to $79.68. As of May 14, its listing was only 9 trading days, which has risen nearly 220% from the offer price of 25 US dollars.
Beyond Meat's stock price carnival has caused the global market related concept stocks to move, and the A-share market has set off a boom in artificial meat. From May 6 to 15, the artificial meat index rose by 43.81%.
But investors who follow the trend are not too happy, the latest news shows that Beyond Meat stock has been short-selling in the US market. Another institutional analyst said that the stock price has deviated too far from the fundamentals.
Has been stared at by the bears
In the early morning of the 15th Beijing time, Bloomberg reported thatAbout 44% of Beyond Meat shares were short-soldBloomberg also cited data from S3 Partners, a body that specializes in analyzing market short-selling data, further reported thatAs early as last week, 22% of Beyond Meat shares were short-selling. At present, “the first batch of artificial meat” has become one of the top 20 US companies that have been sold short.
According to the data, Beyond Meat has a total share capital of 59.8 million shares and currently has 11 million shares in circulation. If calculated according to Bloomberg data,The number of shares that were shorted by the stock was approximately 4.84 million shares.
Last week, the US Harrington Alpha Fund became the first institution to publicly announce the shorting of Beyond Meat. The fund manager Bruce Cox believes that the valuation of Beyond Meat has been “quite ridiculous”. From any point of view, its valuation has been out of control. “It will definitely roll over, it is only a matter of time”. Bruce Cox believes thatThe stock's share price should be around 40 dollars.
Wall Street analysts who were optimistic about Beyond Meat are also changing.
Wall Street investment bank Freedom Finance JSC analyst Erlan Abdikarimov is one of only two analysts in the US stock market covering Beyond Meat. Prior to Beyond Meat's listing, he gave the stock a "buy" rating with a 12-month target price of $28.
However, the analyst said that the stock price has soared after the IPO, he plans to modify the investment proposal for "the first stock of artificial meat" in the next few days. Abdikarimov said: "We are now seeing, in many ways, high expectations for the alternative meat market have driven speculation."
Alexia Howard, an analyst at Bernstein, another analyst in the US stock market that covers Beyond Meat, is still silent. She gives Beyond Meat a target price of $81.
There are also short-sellers who say that May 28 may be a key time window. After the regulatory silence period, some Wall Street institutional research departments responsible for selling Beyond Meat stocks will be able to publish research reports on Beyond Meat, and more doubts about the company will emerge.
Company business is questioned
Beyond Meat was founded in 2009 and is based in El Segundo, California. Initially, the company focused on frozen chicken research and later turned to artificial meat research.
In December 2018, the company started the IPO process and was considered to be the “first stock of artificial meat”. The company's filings with the Securities and Exchange Commission (SEC) show that Beyond Meat's ace product, the beijed Burger, which has been labeled as "looking, cooking, and taste no different from traditional beef," has gradually gained Consumer recognition.
According to the company, Beyond Meat's products are currently sold in mainstream US supermarkets such as Kroger, Whole Foods, etc., and have been selected as menus for many restaurants.
When CSI started the IPO at the end of last year, it was inquired from friends in New Jersey, the most densely populated state in the United States. The feedback was that this kind of artificial meat burger was actually seen at Whole Foods, which was priced at about $6.99. /lb. However, according to local consumers, there are not many people who know and buy the product. The friend of Zhongzheng Jun said that his family did not have it in the past and did not want to “follow the wind” to purchase such products in the near future.
Data shows that Beyond Meat's revenue in 2018 was $87.9 million, a loss of $28.7 million; revenue in 2017 reached $32.6 million, a loss of $27.3 million; revenue in 2016 was $16.2 million, a loss of $25.1 million. The market predicts that the company's revenue will reach 207 million US dollars in 2019, with a loss of 39 million US dollars.
In addition, many analysts warned thatThe market may overestimate the barriers to entry in the artificial meat market, food giants such asTyson FoodIt may be "very easy" to get involved in this market. Once the giants enter, Beyond Meat will face great competition.
Tony Scherrer, an analyst at Smead Capital Management in the United States, stressed that the company continues to lose money while facing many competitive competitors. From the analysis of supply data submitted by the company, Beyond Meat relied too much on a single supplier and did not sign a fixed contract with any co-manufacturer.
On the investment information platform Seeking Alpha, Dane Bowler, a net-red coffee company registered as a hedge fund analyst, said: "I have a degree in nutrition and have to write down my dislike of Beyond Meat. First, its The extreme valuation, the second is that its product nutrition does not look so healthy.” The news was “liked” by many users and triggered thousands of comments.
Source: Seeking Alpha
Artificial meat partners can be well
At present, Beyond Meat's share price has become the vane of the artificial meat concept stocks in the global market.
In the London market on May 14, the UK sandwich chain manufacturer Greggs rose more than 15% to a record high. The stock has risen more than 60% this year. Greggs said that consumer demand for the company's vegan sausage rolls is strong, and the new products launched in January have been greeted by vegetarians, and its business in 2019 may be "very strong."
On May 2nd, Beyond Meat was listed in the US during the May Day holiday. After the opening of the A-share market on May 6th, the concept of “artificial meat” was born, and many concept stocks continued to rise daily for several days.As of May 15, the artificial meat index rose by 43.81%LeaderFengle Seed Industry,Twin tower foodBoth rose by more than 80%.
Affected by the overnight surge in Beyond Meat's share price, on the 15th, the artificial meat index rose 6.05%, 4 of the 18 constituent stocks rose daily, and another 7 rose more than 5%.
China Merchants SecuritiesThe research report released on May 7th believes thatThe artificial meat theme has three major features: new theme, large space and strong catalyticIt will likely become a new strong theme, focusing on the two main lines of protein raw materials, deep processing and product sales. But the study also believes thatFrom the perspective of the theme investment, the current A shares are not purely standard.
Guojin SecuritiesThe research report released this week believes that from the perspective of consumer acceptance, cost, technology, ethical laws, food safety, etc.Artificial meat has a larger distance from mass production.. Especially from the perspective of pork consumption habits in China, cold meat is not yet popular, and artificial meat takes more time.
Some market participants are even pointing to the "artificial meat" companies in this round of rising is "hot".
Daxie has invested in artificial meat industry
Regardless of the market speculation atmosphere, the “health” and “environmental protection” concepts of artificial meat have penetrated the hearts of consumers and will become the future trend.
According to data provided by research institutions, the global population is expected to grow to 9 billion in 2050. The middle-class consumer group will grow, and the demand for and consumption of protein will increase, which will increase the environmental burden. Meat and dairy products provide 18% of calories and 37% protein to humans, but the livestock industry accounts for 83% of the cultivated land and emits 60% of greenhouse gases.
Beyond Meat's official website emphasizes that artificial meat mainly uses plant protein such as soybeans and peas. Compared with ordinary beef burgers, they produce “artificial meat burgers” that can save 99% of water, 93% of land, and 90% of production. The emissions and 46% of the energy.
In recent years, Silicon Valley has set off a wave of food technology entrepreneurship and investment. Institutional estimates,The food science and technology industry has a bright future, and the market size in the future is expected to reach the level of 100 billion US dollars.
In fact, since 2014, many investment circles have begun to get involved in the artificial meat sector. Beyond Meat's individual investors are big coffeeGather,includeMicrosoftCompany founder Bill Gates, famous movie star Leonardo DiCaprio andMcDonald'sFormer CEO Don Thompson and others.
In 2014, Hong Kong tycoon Li Ka-shing injected $10 million into artificial meat start-up company Modern Meadow in New York through its investment company Horizons Ventures for the development of artificial meat. In addition to investing in Beyond Meat, Bill Gates also invested in another startup, Impossible Foods, which also makes artificial meat.
Impossible Foods announced on May 14 that the latest round of financing raised $300 million. Li Ka-shing's Horizons Ventures and Singapore's sovereign fund Temasek led the round of financing, and Impossible Foods currently has a financing scale of more than $750 million.
At the same time, Israel is also at the forefront of the world in the development of artificial meat technology. Its three well-known laboratory meat companies are SuperMeat, Future Meat Technologies and Meat the Future.
(Article source: China Securities Journal)