Credit Suisse Waits For Beyond Meat To Reach Perfect Temperature

Beyond Meat Inc BYND will continue to be a leader in the plant-based fresh meat category and increase its share in the U.S. meat industry, according to Credit Suisse.

Yet the newly public stock’s valuation already reflects “a best-case scenario” for the company’s growth over the next six year — without incorporating the near-term execution risk that is typical for early stage startups, according to the sell-side firm. 

The Analyst

Credit Suisse’s Robert Moskow initiated coverage of Beyond Meat with a Neutral rating and a $70 price target.

The Thesis

Beyond Meat has achieved a “significant head start” in a market with high potential, backed by its R&D capabilities, targeted branding and an early foray into top restaurants and grocers, Moskow said in the Tuesday initiation note. (See his track record here.)

Credit Suisse estimates the total addressable market at $100 billion in the U.S.

The plant-based category could become increasingly popular, capturing 7.7 percent of this market in the medium-term, the analyst said. 

Beyond Meat could capture a 26-percent share of this market by leveraging its product R&D capabilities, strong customer relationships and brand image, Moskow said. This translates to sales of $2 billion in the U.S., he said. 

Adding $500 million of international potential takes Credit Suisse’s total sales estimate for the company to $2.5 billion by 2029, up from $200 million in the current fiscal year, the analyst said. 

Price Action

Beyond Meat shares were up 7.5 percent at $85.65 at the time of publication Tuesday. 

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Beyond Meat IPO: What You Need To Know

Photo courtesy of Beyond Meat.