Preparing for change in a well-established, well-capitalized industry is not easy.
Such is the story for ticker symbol BYND, formally known as Beyond Meat (BYND) in supermarket aisles across the US.
While Beyond Meat’s stock price has changed over the years, its CEO and founder Ethan Brown has not. The basketball-loving former fuel cell industry executive is focused on taking the company he founded in 2009 with his own savings to the next level.
“We believe the cycle of history is in our favor and we’re going to turn it into long-term success,” Brown said on the latest episode of Yahoo Finance’s Lead This Way (video above). ,
Beyond Meat CEO Ethan Brown spoke to Yahoo Finance about the plant-based business.
Beyond Meat burst onto investors’ radar with a spectacular initial public offering on Nasdaq on May 5, 2019.
Investors gobbled up shares of a company they viewed as a leader in the emerging plant-based food movement. The company priced its IPO at $25 per share, opened for trading at $46 and then rose to $65.75 by the close. Profit at the closing bell: a delicious 163%.
Beyond Meat CEO Ethan Brown celebrates with guests after ringing the opening bell at Nasdaq MarketSite on May 2, 2019 in New York City. (Drew Angerer/Getty Images) (Drew Angerer via Getty Images)
From there, it was a whirlwind of activity for Beyond Meat and Brown, including big deals with global restaurant chains like Yum! The brand is planning expansion into the refrigerated food sections of retailers such as KFC and Dunkin’ Donuts (YUM), Target (TGT) and overseas, and efforts are underway to expand manufacturing capacity and create new plant-based items. Are.
By July 2019, Beyond Meat shares reached a peak of $234.90 per share.
However, the COVID-19 pandemic hit the restaurant industry, and its financial impact sent people turning back to cheaper meat-based items at supermarkets. Beyond Meat’s impressive momentum has stalled along with the rest of the plant-based food movement, including rival Impossible Foods.
Additionally, attacks from strong parties in the meat industry and media on the healthfulness of plant-based items have damaged Beyond Meat’s standing with consumers. By November 2022, as losses hit cash flow, the company was forced to lay off 19% of its employees.
Then in November this year, Beyond Meat – which has cut prices to stimulate demand – said it would cut 19% of its non-production workforce after a lower-than-expected third quarter.
Third-quarter sales fell 8.7% from a year earlier to $75.3 million. The company lost $57.5 million based on adjusted operating profit.
“You know there’s going to be resistance to change, and maybe early on we felt that when we first launched, and especially after the IPO,” Brown told Yahoo Finance several months before the latest round. “It was going to happen overnight.” Retrenchment. “This has clearly not been proven to be the case.”
Three leadership tips from Beyond Meat CEO Ethan Brown: surround yourself with great people, take a long-term view, and find your true north and stay the course.
“But the reason we started this company and the reason consumers are reaching out to a product is getting stronger day by day, whether it’s the health aspect, whether it’s climate, whether it’s energy and Whether it’s water use or animal welfare,” Brown added. , “All of those issues are becoming serious, and we have a solution that is available to anyone who wants it.”
Today, Beyond Meat’s stock is trading at $8.95 per share – well below its staggering post-IPO high. According to comparative data from Yahoo Finance, the company has a market cap of $577.6 million, while Meat King Tyson (TSN) has a market cap of $18.46 billion.
“In terms of the reasons for the softening in the US, it’s pretty much the same: consumers continue to shy away from the category for a number of reasons, including taste and perceived health benefits (or lack thereof),” said JPMorgan packaged foods analyst Kane. Are included.” Goldman said.
Goldman has given Beyond Meat shares an underweight rating, which is equivalent to a sell rating.
Yahoo Finance Executive Editor Brian Sozzi (left) chats with Beyond Meat Founder and CEO Ethan Brown (right) inside their new El Segundo, California headquarters about the path forward for the plant-based meat company. (Yahoo Finance)
Brown, meanwhile, is focused on dismissing the critics. Beyond Meat recently opened a massive 288,000-square-foot headquarters in a former aircraft hangar in El Segundo, California, just steps away from the headquarters of Barbie maker Mattel (MAT). The space is equipped with a state-of-the-art test kitchen and a typically open floor plan that could herald the next big thing in plant-based dining.
The new facility also features a McDonald’s (MCD) themed test kitchen where the company focuses on cooking up potential new items for the Golden Arches.
The 6-foot-5 tall Brown has a corner office with his KPIs (key performance indicators) on the outside wall to encourage employee discussion. Brown often walks around the building to interact with staff with his trademark calm, welcoming atmosphere.
Brown acknowledged that the road ahead won’t be easy and he’s not in the mindset to consider the business path forward yet at this point. But he will not shy away from his personal mission to do good for the planet by leading with heart and passion.
“I want to see [my mission] Until completion,” Brown said. ”I think it would be something [that] When it’s all said and done, I’ll look back. But I’m in a fight right now, so it’s hard to watch.”
brian sozzi is the executive editor of Yahoo Finance. Follow Sozy on Twitter/x
@bryansozzi and on Linkedin, Tips on deals, mergers, active positions or anything else? Email [[email protected]](/cdn-cgi/l/email-protection).
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Source: ca.finance.yahoo.com
