Investors digest Beyond Meat’s share offer as stock dives
The shine came off Beyond Meat’s blockbuster summer debut on Wall Street this evening, as its stock plunged after the plant-based burger group revealed plans to sell more shares.
The food group’s stock dived more than 10 per cent in after-hours trading as investors digested the announcement of a secondary share offering which will dilute the value of current shareholders’ stake.
Read more: Beyond Meat shares surge a day after results
In spite of the share price drop, Beyond Meat trumped sales expectations tonight.
Customers’ growing appetite for vegan alternatives to meat showed no sign of waning over the last three months, as the food group posted a 287 per cent rise in year-on-year revenues to £67.3m, beating analyst expectations of $52.7m.
Second-quarter net losses of 24 cents per share, or $9.4m (£7.7m), were also wider than losses of eight cents per share which analysts had forecasted.
Beyond Meat’s second report as a public company today was billed as a major test of shareholder optimism, following a blistering two-month run on Wall Street during which its share price has soared by roughly 700 per cent.
The firm’s listing in May, which raised $240m, came on the back of plans to ramp up marketing and production efforts to fend off growing competition from a crowded field of traditional and start-up rivals.
Read more: Beyond Meat hits triple its IPO price
However, in recent months the group has also attracted the attention of short-sellers, who have been betting that the firm’s stock is overvalued and will drop in the future.