IPOs: Beyond Meat or Beyond CRAZY!?

[ExFlyBoy5]

While perusing the interwebs, I came across a story on "Beyond Meat" on CNBC. Now, I don't watch CNBC very often and I might take a look at their website headlines once every few days but I have seen this Beyond Meat being covered every time I have been to the site. So, I read the story and was amazed to learn that this company had its IPO back in May but now its market cap is over $10 BILLION and is larger than 80 S&P 500 companies...some of which include Macy's and Zerox.

Since going public in early May, the stock has raced nearly 600% higher, taking its market cap above $10 billion. The plant-based meat company is now larger than 80 S&P 500 companies, including Macy’s, Xerox and Mylan.

https://www.cnbc.com/2019/06/19/bey...ga-rally-but-ipo-euphoria-might-not-last.html

To me, this is MADNESS! I am a "steady as she goes" index investor, so I don't keep up with most of the IPO news, but this just really blows me away. Is there just THAT much money that people have no issues with these highly speculative stocks that have made NO PROFIT!?!

Some of the highest-profile IPOs this year, such as Beyond Meat, Lyft and Uber, are companies without profit. Beyond is not projected to generate quarterly income until the third quarter of 2020, according to FactSet estimates.

 

[Walt34]

There was some guy... long time ago, had a famous quote... oh yeah, P.T. Barnum!

 

[aja8888]

Momentum....(for a while, anyway)

 

[RetireBy90]

Even worse is that product is more expensive and the pitch is more humane than raising beef and no cow methane. Crazy crazy

 

[braumeister]

I believe the stock is only being sold to a limited group of investors. A very special type of person, only one of whom is born in any given minute.

 

[Midpack]

It’s a great product in my view, we’ll continue to buy for “burgers” at home and we’re seeing Beyond Meat and Impossible burgers in more restaurants all the time - but no idea how stock valuation will develop.

 

[RAE]

It’s a great product in my view, we’ll continue to buy for “burgers” at home and we’re seeing Beyond Meat and Impossible burgers in more restaurants all the time - but no idea how stock valuation will develop.

I guess we will have to disagree on the value of the product. Personally, I wouldn't touch this pseudo-food (or the company that produces it) with a 10-foot pole. That's not to say that some people won't make money investing in it, because I'm sure some will.

 

[Breedlove]

Beyond Meat is not the old Veggie Burger from the 1980s . I say get ready we need to feed the world cheaper and this might be an answer.

 

[RAE]

Beyond Meat is not the old Veggie Burger from the 1980s . I say get ready we need to feed the world cheaper and this might be an answer.

Well, I don't think the intent of this thread was to debate the merits of the products Beyond Meat is producing, but I will just say that there are many things about their product that are anything but healthy (leaving aside whether we need this fake meat to feed the world or not). If you enjoy eating highly-processed pseudo-food made from a long list of unhealthy ingredients, then their burger may be for you. Here is one article with a list of ingredients in their fake-meat burgers, and a little bit about each ingredient. Eat this stuff at your own risk, folks.



https://ancestral-nutrition.com/beyond-meat-is-beyond-unhealthy/

 

[gerntz]

If you enjoy eating highly-processed pseudo-food made from a long list of unhealthy ingredients, then their burger may be for you. Here is one article with a list of ingredients in their fake-meat burgers, and a little bit about each ingredient. Eat this stuff at your own risk, folks.



https://ancestral-nutrition.com/beyond-meat-is-beyond-unhealthy/

Yuck! I'll stick to dead cow.

 

[audreyh1]

Well, I don't think the intent of this thread was to debate the merits of the products Beyond Meat is producing, but I will just say that there are many things about their product that are anything but healthy (leaving aside whether we need this fake meat to feed the world or not). If you enjoy eating highly-processed pseudo-food made from a long list of unhealthy ingredients, then their burger may be for you. Here is one article with a list of ingredients in their fake-meat burgers, and a little bit about each ingredient. Eat this stuff at your own risk, folks.



https://ancestral-nutrition.com/beyond-meat-is-beyond-unhealthy/

Basically why I wouldn't consider it. If I really want a burger (which I almost never eat) I'll go for the grass-fed beef ground instead. Nothing wrong with the "real thing". Studies indicating that red meat is bad for you have extremely weak evidence with tons of confounding factors.

 

[Midpack]

Well, I don't think the intent of this thread was to debate the merits of the products Beyond Meat is producing, but I will just say that there are many things about their product that are anything but healthy (leaving aside whether we need this fake meat to feed the world or not). If you enjoy eating highly-processed pseudo-food made from a long list of unhealthy ingredients, then their burger may be for you. Here is one article with a list of ingredients in their fake-meat burgers, and a little bit about each ingredient. Eat this stuff at your own risk, folks.



https://ancestral-nutrition.com/beyond-meat-is-beyond-unhealthy/

We all make our own decisions, but an article from a self promoting blogger (pic below) with unknown credentials wouldn’t be my first choice to make a point. Especially one who leads off talking at length about how bad soy isolate is when 3 of the 4 products she references don’t include it.

And then she shares the dangers of canola oils processed with chemicals even though 3 of the 4 products she references list expeller expressed canola oil which does not rely on chemical processing - only mechanical extraction, e.g. squeezing the seeds! And BTW, good luck avoiding canola oil in everything you eat.

Self-professed “experts” (e.g. Jenny McCarthy) are conveniently everywhere these days...

There are other reasons to choose alternatives to beef that she ignores too, the environmental impact and the animal cruelty aspects for starters - all well documented. If you tour a production slaughterhouse and still choose beef, and don’t see anything wrong with it, that’s up to you.

It’s a choice, there’s no completely benign option.

 

[Maenad]

Is there just THAT much money that people have no issues with these highly speculative stocks that have made NO PROFIT!?!

1. Pets.com (my favorite example from that era)
2. Cryptocurrencies, especially end of 2017

So, yeah. Everyone is trying to find the next Big Disruptive Thing, so when a company comes along with a pretty radical new product, that's generating lots of discussion, the speculators come out in force.

 

[kcowan]

I view Beyond Meat et al as speculative investments. I used to dabble in those and it is impossible to use metrics to study them before buying and even harder to decide when to sell because these are not buy and hold stocks!

I am all for alternative products that taste good. Someday, they will probably have alternative to lamb, boneless/skinless chicken thighs, pork and beef. But we only eat beef occasionally. And the price of Beyond Meat is likely to keep us from switching.

I never buy burgers at restaurants although I plan to try the A&W breakfast sandwich that uses it instead of a sausage patty.

 

[Rianne]

Food for the future. IMHO, this way of eating will explode. We had dinner with a Chinese friend from the university a couple of nights ago. He's on his way to China for a post doc research opportunity. It's all about vegetable protein. Incorporating the meat texture and flavor from vegetables. He's a food scientist and this concept is going big in China.

 

[RAE]

And then she shares the dangers of canola oils processed with chemicals even though 3 of the 4 products she references list expeller expressed canola oil which does not rely on chemical processing - only mechanical extraction, e.g. squeezing the seeds! And BTW, good luck avoiding canola oil in everything you eat.

If you tour a production slaughterhouse and still choose beef, and don’t see anything wrong with it, that’s up to you.

It’s a choice, there’s no completely benign option.

Yes, canola oil (and/or one of the other industrial seed oils, like soybean oil) are in a whole lot of highly processed pseudo-food products, which is why I try to avoid those products, and stick with real food. By the way, expeller-pressed oil is still usually extracted using high heat, along with mechanical pressure/friction. That high heat can cause the oil to go rancid quickly, and rancid oils have adverse health impacts.

With regard to beef, I agree with you that slaughterhouse (CAFO) beef is not the healthiest choice, which is why I buy grass-fed beef from a local farmer. The animals are raised humanely, it's better for the environment, and the meat is healthier.

 

[JoeWras]

We're encouraging the young generation to get into investing. Well they are! Here is the result. It is something they believe in.

As for fundamentals? Well, there was a thread for another product that had something like 2000 responses, and it was closed due to "emotions."

 

[Clone]

I would assume some of their valuation comes from folks that want to invest in the 'eco friendly' companies. I forget the name of that type of investing, but certainly there are folks who are investing in companies that are aligned with their vision of how things should be. Socially Responsible companies is one of the terms.


I still struggle with the valuation of some companies from a P/E perspective. But I guess looking at P/E only works for very mature old-school profit making enterprises. Or maybe it doesn't mean anything anymore. Another reason that I like owning funds rather than individual stocks.


I see value in companies that are actually making something, like Beyond Meat, as opposed to companies that do not seem to have a way to make profit. But I am concerned that we are seeing behavior similar to the run-up in tech stocks in the late 90s. Maybe this time it is different?

 

[JoeWras]

I would assume some of their valuation comes from folks that want to invest in the 'eco friendly' companies. I forget the name of that type of investing, but certainly there are folks who are investing in companies that are aligned with their vision of how things should be. Socially Responsible companies is one of the terms.

The term you are looking for is "ESG". Vanguard just started such a fund.

And, yes, when I mentioned the young crowd, this is what I was thinking.

It is not my thing, but to many, it is highly valued.

CalPERS targets ESG. Hey, they are a California pension fund, right? Gotta do California things.

They've been struggling with the performance of that section of their fund. I heard a rumor yesterday they were even thinking of going back to investing in the Really Bad Stuff. But, I think it is just a rumor. If anything, they are doubling down. I wonder if Beyond Meat is part of their strategy, or if they are late to the game.

 

[NW-Bound]

I have yet to try the beef alternative to see if it tastes as good as people say. My wife who is not a meat lover says she will not try it because it's highly processed food. She's happy just eating non-meat food. I am going to try anyway myself.

This may catch on, and takes over a big portion of the sales of real beef. Who knows? But for the company to have such high valuation, it must have some "secret sauce" or patented process that other contenders cannot duplicate or have an alternative. Or is it that being first to the market to establish a name is enough? Time will tell.

 

[youbet]

With regard to beef, I agree with you that slaughterhouse (CAFO) beef is not the healthiest choice, which is why I buy grass-fed beef from a local farmer. The animals are raised humanely, it's better for the environment, and the meat is healthier.

And you can say the same thing about fish. DW and I very seldom eat "factory fish" harvested by huge netting or long line operations or "farmed fish" processed in questionable sanitary conditions on board or on shore. We prefer catching, cleaning and freezing our own. The exception is salt water fish which we seldom have direct access to (we're Midwesterners).

 

[timo2]

Here is another one: 'The Perfect Burger'. I was wondering when the traditional veggie burger people would respond to the beyond meat stuff

"Dr. Praeger's Introduces the Perfect Burger™

The juicy and delicious Perfect Burger looks and tastes like meat, but is made with clean, veggie-forward ingredients and infused with four kinds of veggies: sweet potato, butternut squash, beet, and carrot. It cooks just like beef on the grill or stove-top.

The Perfect Burger is soy free, gluten free, and vegan. It’s packed with 20g of non-GMO plant protein and contains 15% less sodium and 22% less fat per serving than the leading meat-y veggie burger.

“The meat-alternative burger market lacks a tasty, vegan burger that contains a short and simple ingredient list,” says Larry Praeger of Dr. Praeger’s, “The Perfect Burger provides all the flavor you want from a traditional beef burger, but with clean plant-based protein and ingredients you can taste with each flavorful bite.”

Dr. Praeger’s Introduces the Perfect Burger™ | FinancialContent Business Page

 

[timo2]

I just saw where Tyson's and Perdue are getting into the act, bu blending veggies in with the real meat
"The company said Thursday that it plans to launch a line of chicken-free (but not egg free) chicken nugget alternatives, as well as burger patties made with a combination of beef and plants. None of the products, which will hit shelves later this year, are vegan. Tyson (TSN) said it plans to roll out other protein alternatives in the future."

https://www.cnn.com/2019/06/13/business/tyson-alternative-meat/index.html

 

[Chuckanut]

IMHO, people who sell 'detox' regimes and 'cleanses' are in the same category as people who call you and advise buying some unknown stock because 'projections show it will quadruple in the next six months'.

As far as the fake meat burgers that are all the rage, I still don't understand why people who want to avoid meat, insist on duplicating it with factory made, non-meat products containing things like cellulose from bamboo. I have yet to meet a meat lover who is working on a recipe to make meat taste like carrots or broccoli, or green beans, or apples, etc. etc. etc. There are many tasty vegetarian recipes in books and online. There is no need for fake meat. My lentil burgers are quite tasty with some seasoning, my home made ketchup, and caramelized onions.

Are these fake meat burgers a good investment? I have no idea. I put them int he same category as investing in retail pot-shop companies. They are a speculation at this point, IMHO.

 

[RAE]

As far as the fake meat burgers that are all the rage, I still don't understand why people who want to avoid meat, insist on duplicating it with factory made, non-meat products containing things like cellulose from bamboo. I have yet to meet a meat lover who is working on a recipe to make meat taste like carrots or broccoli, or green beans, or apples, etc. etc. etc. There are many tasty vegetarian recipes in books and online. There is no need for fake meat.

I think there will always be a demand for a product that looks and tastes like meat, but does not contain meat. Lots of people believe that meat is unhealthy (I am clearly not one of them), but still find it appealing to eat something that looks and tastes like meat. That's probably because humans crave (and require) protein, and meat is rich in protein.