Beyond Meat shares hit 52-week lows after lowering sales outlook for third quarter

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Beyond Meat “Beyond Burger” patties made from plant-based meat substitutes are on sale on a shelf in New York City on November 15, 2019.

Angela Weiss | AFP | Getty Images

Beyond Meat’s shares hit a 52-week trading low on Friday after the company warned it expected lower sales for the third quarter than previously forecast.

Beyond said it expects net sales of $ 106 million, down from its previous outlook of $ 120 million to $ 140 million. Wall Street analysts surveyed by Refinitiv expected revenue of $ 133.1 million for the quarter. The company did not announce an outlook for quarterly earnings, but analysts expected a loss of 29 cents per share before the announcement on Friday.

Beyond stocks recently lost nearly 14% after falling to $ 91.55. The stock is down 25% this year and has a market value of $ 5.9 billion.

The company said several factors caused the delay in sales, including the impact of the Covid-19 Delta variant. In addition, a Canadian distributor said that when it reopened its restaurants, it had been reducing retail orders for longer than expected and expecting additional orders that failed to materialize after one of its large customers switched distributors. The labor shortage likely also delayed the expansion of sales and the reset of shelves, the company said.

Operational challenges have also harmed the results. One facility in Pennsylvania lost drinking water for two weeks and another suffered inventory water damage from storms, Beyond said.

“In our view, BYND has not yet fully grasped the underlying issues affecting its results, particularly in relation to the distinction between Covid-related issues and the impact of increased competition from plant-based meats and / or weak consumer demand due to it the high price, disappointing taste or health concerns, “CFRA analyst Arun Sundaram wrote in a statement on Friday.

Beyond shared a bright spot for sales in the quarter: An international customer accelerated orders. The company did not provide the customer’s name.

Beyond’s initial third-quarter revenue forecast disappointed investors when the company released it in early August. After grocery sales soared during the lockdown last year, demand has fallen. At the same time, orders in the catering sector have not yet fully recovered, even if the restaurants are at full capacity. Executives said last quarter that many restaurants are more conservative with their orders because they are unsure of the impact the Delta option will have on business.

Beyond is expected to release its full third quarter results after the bell on November 10th.

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