On Tuesday, Beyond Meat got a rating downgrade from J.P. Morgan analysts.
Since their IPO in May 3, shares of the plant-based meat substitutes producer has skyrocketed around +600% – something that J.P. Morgan feels reflects a valuation that could potentially make the company vulnerable to a substantial correction in the event of any hiccup in performance. The investment bank downgraded the stock to “neutral” from “overweight” and maintained its price target of $120.
However, J.P. Morgan has also indicated that it is not keen on an “underweight” rating on Beyond Meat at this point, since it is hopeful that the latter’s 2019 fundamentals are likely to surpass the Street expectations. The bank’s perceived downside risk to Beyond Meat is based on an estimated long-term growth path.
Beyond Meat's plant-based foods are expected to more than double its revenue over the next two years, as indicated by the company last week.
Following the rating downgrade by J.P. Morgan, Beyond Meat shares lost -20% on Tuesday.