By Christiana Sciaudone
Investing.com -- Beyond Meat (NASDAQ:BYND)'s getting grilled after reporting miserable earnings and a possible relationship -- or not -- with McDonald's (NYSE:MCD).
Shares are tumbling more than 20% after the plant-based burger maker reported a third quarter loss per share of 28 cents per share that compared to the expected earnings per share of 5 cents on sales of $94.4 million, which missed the estimated $132 million, according to analysts tracked by Investing.com.
The results were "shockingly weak," Credit Suisse (SIX:CSGN) said, according to StreetInsider, lowering the price target to $120 from $240 and reiterating a neutral rating. Analyst Samik Chatterjee warned investors not to buy today's dip, noting the lack of clarity as to whether or not Beyond Meat is actually involved with a McDonald's veggie meat, as well as decelerating growth trends in U.S. retail consumption.
Oppenheimer analyst Rupesh Parikh reiterated a perform rating on Beyond Meat after the company reported an adjusted EBITDA loss of $4.3 million that fell short of the Street consensus of $13.1 million. A combination of weaker retail and foodservice revenue and sharply lower gross margins contributed to the miss.
"Management commentary suggests impacts related to the pandemic on the foodservice channel and consumer pantry loading contributed to the underperformance in Q3," said Oppenheimer analyst Rupesh Parikh, advising investors to remain on the sidelines, according to StreetInsider.
While a McDonald's partnership remains unclear, Beyond Meat did announce an actual deal with Pizza Hut to serve Beyond Pan Pizzas with Italian sausage and other non-meat meat ingredients.
Beyond Meat shares have been on a roller coaster ride since McDonald's said on Monday it would make the McPlant, a meatless burger. That sent shares of Beyond Meat lower, until Beyond Meat came out and said that it was actually a co-creator with the fast food chain on the McPlant patty. McDonald's hasn't said a peep about it yet.
Last month, Beyond Meat hit a record, rallying more than 150% in 2020. The stock has jumped repeatedly this year as the company has announced new products, including plant-based meatballs and expansion in China. McDonald's had tested a Beyond Meat patty in Canadian stores until April of this year.