Considering the shift in the American food end consumer and the potential to appeal to more mainstream users as well as its growth strategy, what is the fair valuation for Beyond Meat?
Founded in 2009 by CEO Ethan Brown, Beyond Meat has grown to become a nascent leader in plant-based alternatives for the traditional beef, pork and poultry categories, with products sold in national restaurant chains and supermarkets. On May 2, 2019, Beyond Meat completed its initial public offering on the Nasdaq at $25 per share and traded up to $46 per share when the market opened. Operationally, Beyond Meat has just reached positive gross profits and is expected to improve profitability in the next few years, though heavy R&D and marketing requirements in the next few years are expected to dampen operating profit margin. While analysts expect Beyond Meat to generate significant top-line growth over the next few years, its longer-term trajectory depends on its ability to categorize itself as a mainstream producer of proteins rather than a niche vegetarian company. In this case, students will be asked to analyze Beyond Meat’s business, strategy, industry and peers, examine financial filings and stock history, and build a valuation model to determine how much the equity of the firm is worth.
Case ID: 220305
Supplemental Materials: Excel Spreadsheets , Valuation Spreadsheet