Breaking News
Get 40% Off 0
Is NVDA a 🟢 buy or 🔴 sell? Unlock Now

Beyond Meat, Shopify Fallout Is Latest Sign of Growth Reckoning

Published Oct 29, 2019 01:54PM ET Updated Oct 29, 2019 04:36PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. Beyond Meat, Shopify Fallout Is Latest Sign of Growth Reckoning
 
BYND
+3.03%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

(Bloomberg) -- The price that equity investors are willing to pay for fast growth is being tested again as slumps in Beyond Meat (NASDAQ:BYND) Inc. and Shopify Inc. show they’re demanding more of companies with premium valuations.

The veggie-burger maker and e-commerce platform on Tuesday became the latest examples of firms that delivered on revenue-growth expectations only to see their stocks fall. Meanwhile, the food-delivery company GrubHub Inc. showed how damaging the fallout can be when that growth fades.

Shopify slid as much as 7.7% in Toronto despite boosting its revenue forecast for the year. The company reported an unexpected third-quarter loss after it increased spending to expand its customer network and build out fulfillment centers across the U.S. The stock was up 124% year to date through Monday’s close and has a forward price-to-estimated sales ratio of 18, compared with an average of 1.6 for the S&P/TSX Composite Index.

A higher sales forecast also proved insufficient for Beyond Meat, which saw its shares tumble as much as 24% on concerns about competition and the expiration of a lockup for early investors. Beyond Meat shares are still up 240% since their initial public offering in May, but that’s far from their 800% returns back in July. The stock trades at a forward price-to-sales ratio of 12, more than 6 times the average multiple for stocks in the S&P 500 Index, according to data compiled by Bloomberg.

GrubHub may provide a cautionary tale. Its shares plunged a record 44% after the food-delivery company gave a fourth-quarter outlook that was well below expectations, as intensifying competition and “promiscuous” customers weighed on growth trends.

Beyond Meat, Shopify Fallout Is Latest Sign of Growth Reckoning
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your investing.com profile, will be public on investing.com and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email