(Reuters) – Shares of Beyond Meat Inc ( BYND.O ) sank on Tuesday, ending a lockout period for its early supporters, releasing them for cash at this year's double in stock price following results that showed increasing costs in the plant-based meat success story.
FILE PHOTO: The Beyond Meat company logo and trading information appears on a screen during the IPO of the Nasdaq Market in New York, USA, May 2, 2019. REUTERS / Brendan McDermid / File Photo
It was unclear about any of the company's early Investors were among those selling in early deals, but analysts said expectations someone would make money are likely to weigh on the stock in the near term.
“About 3/4 of the shares are unlocked today, as many Beyond Meat observers are aware. What is less visible is the number of shareholders willing to sell with the share down over 50% from the high, ”said J.P. Morgan analyst Ken Goldman.
"Regardless, if the expiry of the expiry in the past eventually, it would eventually incentivize some investors to start buying the stock again, even though the shares could turn out lower in advance." Goldman wrote.
By the end of July, Beyond Meat shares had increased five times in value from the $ 46 debut price, but have since withdrawn and closed at $ 105.41 on Monday, valuing the company at $ 6.38 billion.
Shares fell 16% to $ 88.50 in trading before Tuesday, making it the biggest loser among Nasdaq-listed companies.
The vegan burger maker's quarterly number, published after the market closed on Monday, showed its first ever profit and lifted its sales forecast for the entire year, but also said it would need to offer more discounts as the competition gets hotter.
At least three Wall Street analysts cut their stock price target after the results, with J.P. Morgan's Goldman reduced its target to $ 138 from $ 189.
The end of the 180-day bond period so employees, insiders and other early supporters can sell has been well advertised, but will further contribute to the pool of Beyond Meat shares available following the unusual and unexpected secondary offer by the company in July .
"Increased competition from new listings to the plant-based category represents the biggest disadvantage of our (price target)," Credit Suisse analyst Robert Moskow wrote in a note.
"We believe that increased liquidity … will put the shares in a lower valuation range."
Of the 12 analysts covering Beyond Meat, eight consider it & # 39; hold & # 39 ;, two & # 39; sell & # 39; And only two now propose to buy the shares.
Reporting by Nivedita Balu in Bengaluru; editing by Patrick Graham