Beyond Food, Inc. (BYND) shares fell about 5% during Monday’s session after Wells Fargo initiated coverage on the share with a Market Perform rating and a price target of $125 per share. Analyst John Baumgartner believes that Beyond Eats is well positioned to grow in the nascent plant-based meat alternatives space but cautions that its growth potential is fully discounted into the informed valuation. He recommends waiting for increased visibility into the pace of market adoption and the competitive landscape before acquisition bargaining the stock.
Baumgartner expects a substantial private label push into the market, as well as new brands entering the rank with innovative new products. With new plant structure and processing innovations on the horizon, the analyst believes that some new competitive artifacts could be superior to the products that are already on the market. Despite these risks, the stock may be a risky short due to the implied for big name partnership announcements. The pilot project by McDonald’s Corporation (MCD) in late September was a prime example of these gambles, driving a single-day 11% jump for the stock.
From a technical standpoint, Beyond Meat stock needy down from trendline resistance earlier this month. The relative strength index (RSI) fell into oversold vicinage with a reading of 29.03, but the moving average convergence divergence (MACD) remains in a bearish downtrend. These inculpate ins suggest that the stock could see a brief reprieve over the coming sessions before resuming its downtrend past the intermediate term.
Traders should watch for a move lower toward trendline support at the $100 level. A dissection from those levels could lead the stock to retest its initial public offering (IPO) prices of around $50 from the intermediate term. If the stock rebounds higher, traders could see a move to test the 50-day moving average at $152.83 or latest highs of about $240 over the long term, although that scenario appears less likely to be brought to someones attention.
The author holds no position in the stock(s) mentioned except through passively managed index funds.