Beyond Meat (NASDAQ: BYND) stock jumped over 30% to a six-month high on Wednesday. The surge came as the plant-based meat producer announced strategic initiatives aimed at bolstering its margins, including price hikes and significant cost cuts. This initiative has triggered a squeeze on its heavily shorted shares.
Shares of Beyond Meat saw a significant short interest of about 37.6% of the free float of the company, equivalent to shares valued at $172.6 million, as of Monday, according to data from analytics firm Ortex. Bearish investors faced paper losses totaling $93 million since the closing of Tuesday.
Beyond Meat also emerged as one of the most shorted U.S. stocks, trailing closely behind COVID-19 vaccine manufacturer Novavax (NASDAQ: NVAX), according to a recent report from S&P Global Market Intelligence.
The company, known for supplying to major fast-food chains such as McDonald’s (NYSE: MCD) and Yum Brands, has been grappling with a substantial decline in market value, losing nearly 70% since its much-anticipated IPO in 2019. This decline coincides with challenging market sentiment surrounding plant-based meat, worsened by higher prices due to sticky inflation.
Beyond Meat Q4 Performance
In the fourth quarter, Beyond Meat reported a 7.8% decrease in net revenue to $73.7 million, beating analysts’ expectations of $66.7 million.
The company also revealed plans to reduce operating costs to restore margins. These margins were impacted by price cuts aimed at appealing to cost-conscious American consumers.
Beyond Meat anticipates gross margins for 2024 to range in the mid-to high-teens percentage, a significant improvement from the negative 24.1% reported in 2023.
Analysts at TD Cowen noted that the company’s strategic shift towards raising prices aligns with its need to target a more specific consumer base for sustainable success, rather than pursuing widespread affordability through continual price cuts.
Beyond Meat (NASDAQ: BYND) Stock Performance
BYND stock surged 30.72% to close at $9.83 on Wednesday. The traders had exchanged hands with 44,504,611 (44.50 million) shares compared to the average daily trading volume of 3.14 million.
Salman Akhtar is a finance, stocks, and technology journalist with years of experience across various news organizations. He has contributed his expertise to outlets such as 24NewsHD, TrimFeed, The Voice Pakistan, and TheTechBasic. Salman is passionate about making complex topics accessible to a broad audience. His dedication to delivering accurate and timely information has established him as a trusted voice in the industry. Read Full Bio
