This Beyond Meat Consumer Survey Highlights Some Challenges, Analyst Says

The bullish case for plant-based food maker Beyond Meat Inc (NASDAQ: BYND) can't be justified amid mixed consumer survey results, according to Piper Sandler.

The Beyond Meat Analyst

Michael Lavery initiated coverage of Beyond Meat's stock with a Neutral rating and $115 price target.

The Beyond Meat Thesis

Piper Sandler surveyed more than 3,500 U.S. adults as part of the research firm's initiation of coverage. Among those surveyed, 62% of respondents were "not interested" in consuming a plant-based food product. Among the remaining respondents who do eat plant-based food, just 2% prefer Beyond Meat products. In fact, five times as many consumers named a competing brand as their favorite product.

Meanwhile, a separate survey with McDonald's Corp (NYSE: MCD) franchisees suggests its Beyond Meat-featured "PLT" sandwich has seen "disappointing" sales so far due to a high price point, the analyst wrote in a note. Among those surveyed, 45% aren't counting on a meatless sandwich to drive significant sales while 60% favor a rollout of a new chicken sandwich which is being tested in a few small markets.

Encouragingly, 15% of respondents were willing to try plant-based food while 7% of people surveyed have no brand preference, the analyst wrote. This suggests potential upside for Beyond Meat to expand beyond its existing client base.

McDonald's alone represents a $100 million annual opportunity in the U.S. and another $50 million in global markets, however, this opportunity is "largely priced into valuation" at current valuation levels.

BYND Price Action

Shares of Beyond Meat were trading around $116.75 at time of publication.

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