Beyond Meat Inc (BYND)

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Beyond Meat Stock Tumbles After McDonald's Launch McPlant -- Barrons.com
1:58 pm ET November 9, 2020 (Dow Jones) Print

By Teresa Rivas

While the market is rallying, Beyond Meat is falling Monday, following news that fast-food giant McDonald's will produce its own faux meat.

USA Today reported on Monday that McDonald's (MCD) will unveil McPlant, a line of meat alternatives that will launch with tests of a faux burger next year could ultimately lead to chicken and sausage substitutes as well.

The news comes after McDonald's reported better-than-expected third-quarter results and unveiled a new strategic growth initiative today. The company also told USA Today that it plans to launch a chicken sandwich, entering the chicken sandwich fray that has been a boon to rivals.

Beyond Meat (BYND), which has soared more than 90% in 2020, is down 8.1% to $144.09 in recent trading.

The highflying stock is no stranger to competition: Impossible Foods, which makes the patties for Burger King's Impossible Whopper, has been gaining market share. ( Restaurant Brands International (QSR), which owns Burger King, also offered Beyond Meat products at its Tim Horton's brand.) Moreover, Burger King is far from its only high-profile partner, as Beyond Meat has expanded across the globe with numerous companies from Yum Brands (YUM), to Starbucks (SBUX).

In addition, Beyond Meat and McDonald's previously had a deal to test the company's faux burgers. So while some analysts long believed that a long-term partnership was unlikely, today's news is a blow to those hoping that the two companies could team up again.

Still, it does highlight the value of the growing plant-based meat market, which has been growing rapidly in restaurants and retail stores, especially among desirable younger consumers.

Keep on eye on Beyond Meat's earnings, which are due after the close. If they're good enough, the selloff might have become a buying opportunity.

Write to Teresa Rivas at [e-mail]