SAN FRANCISCO (Reuters) – U.S. consumers hankering for one of Beyond Meat Inc’s faux-meat burgers can pick one up at the grocery store for about $3 a patty.
That is a fraction of what they are going for on Wall Street, where investors looking to get a serving of the food producer’s sizzling stock appear to be laying down the equivalent of more than $50 a burger.
Beyond - Meat - Topics - Wall - Street
Nailing down just how much Beyond Meat is worth is one of the hottest topics on Wall Street following a nearly 500% surge in its stock since its initial public offering on May 2.
The company has attracted investors betting it will become the dominant player in the nascent market for plant-based hamburgers, sausages and other meat alternatives, even though the company has yet to turn a profit.
Ground - Beef - Retailing - Grocery - Stores
With ground beef retailing in grocery stores for the equivalent of $1 or less per 4-ounce (113 gram) burger patty, according to the U.S. Department of Agriculture, Beyond Meat’s early success in grocery store meat sections shows a market exists for premium-priced burger products made with or without animal.
At nearly $9 billion, Beyond Meat’s market capitalization rivals several mature food companies. Poultry producer Pilgrim’s Pride checks in at $6 billion, for instance, while Campbell Soup Co sports a stock market value of $12 billion.
Wall - Street - Establishment - Price - Tag
So far, the Wall Street establishment does not see that price tag as justified. The eight analysts covering the stock have price targets ranging from 11% to 46% below Beyond Meat’s current share price of around $144, following its recent rally.
Preferred valuation measures like the price to earnings ratio are not useful because Beyond Meat is losing money and is unlikely to record a profit for at least another year or so.
Stock - Times - Year - Wall - Street
Meanwhile, the stock is trading at 38 times this year’s Wall Street revenue estimate, making...
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