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General Category => Investment Ideas => Topic started by: Castanza on June 10, 2019, 12:42:33 PM

Title: BYND - Beyond Meat
Post by: Castanza on June 10, 2019, 12:42:33 PM
Need I say anything? up 600% since IPO. Is anyone shorting this? If not what are your opinions?

From the product standpoint it's actually pretty good. Tried a burger at Red Robin the other day. Their product pipeline is pretty impressive and from what I hear they are all pretty tasty and have good reviews across the board. But they do have some supply chain issues and even if they didn't I find it hard to justify any of the price movement. I can't help but correlate this to TLRY.

Either way I have no positions of any type.
Title: Re: BYND - Beyond Meat
Post by: Gregmal on June 10, 2019, 12:57:07 PM
Shorting longer dated OTM calls usually works well with stuff like this.
Title: Re: BYND - Beyond Meat
Post by: blainehodder on June 10, 2019, 01:01:36 PM
Product is great, valuation is extreme. Good story and low float trading. The company will certainly do well. Shareholders late to this run may not. The market is likely to be flooded with clones soon. From a consumer perspective that is great. Probably not so great for Beyond margins.

Hard to say at this point whether there is any real brand loyalty or if they are simply a first mover on a huge demographic trend. I personally like the products but would happily jump to a cheaper competitor.

The company would be wise to issue huge amounts of equity into this run and pad the balance sheet with massive amounts of cash to fuel operations and growth for years to come.

I wouldn’t invest long term at this level as I doubt it justifies any sane DCF assumptions.
 It is likely trade-able on short term moving averages and other very simple momo indicators. It is working out for longs so far!

Peter Lynch said to wait until turnarounds start to turnaround. That is a good motto in trading as well. I wouldn’t jump in short until it started to break down. No need to be a top calling genius to make money.
Title: Re: BYND - Beyond Meat
Post by: roark33 on June 10, 2019, 01:02:55 PM
Yeah, well OTM calls have become ITM calls with BYND, I mean, you could have shorted like $160 calls last week when the stock was at 90 and now they would be in ITM, and most likely be exercised and force you to hold a short position with 100%+ borrowing costs.  I have no idea how to make money on this, besides going 200% long BYND...bcs it's going to the moon...:)
Title: Re: BYND - Beyond Meat
Post by: Saluki on June 10, 2019, 01:23:29 PM
The product is excellent.  My girlfriend (aka the "Warden") is a vegetarian and she has to try several places (whole foods, trader joes, YES organic) because it's always sold out.  When she spots it in the freezer, she will buy 6 or 7 packages of it at a time. 

The price is outrageous though--both for the stock and the product.  It costs more than actual beef, and the stock is trading at (according to yahoo finance) 83x sales.  I'm not crazy enough to buy it or brave enough to short it, i'll just watch from the sidelines. 
Title: Re: BYND - Beyond Meat
Post by: CorpRaider on June 10, 2019, 06:15:50 PM
The impossible burger is legit, had it twice (over the last month).  Gave up beef maybe 2 years ago.  Really nice to have a good burger again.

Just had a beyond meat sausage.  Not a fan.  Then again I don't like real sausage either.

I thought red robin had the impossible burger, not beyond meat.  They were sold out when we went (never been there before); we left and went to an expensive gastropub where they had the impossible burger in stock.  Read articles that impossible burger is hard to get right now because of the BK rollout.
Title: Re: BYND - Beyond Meat
Post by: Castanza on June 10, 2019, 07:05:09 PM
The impossible burger is legit, had it twice (over the last month).  Gave up beef maybe 2 years ago.  Really nice to have a good burger again.

Just had a beyond meat sausage.  Not a fan.  Then again I don't like real sausage either.

I thought red robin had the impossible burger, not beyond meat.  They were sold out when we went (never been there before); we left and went to an expensive gastropub where they had the impossible burger in stock.  Read articles that impossible burger is hard to get right now because of the BK rollout.

LOL you're right...damn I'm an idiot. I did try the Beyond Burger at TGI Fridays. I guess I didn't really notice a difference. Personally I prefer real beef as there is a definitely a difference. I don't agree with the people who say you can't tell it's not real beef. You can tell, but he experience is still pleasant and enjoyable. However, I don't see myself ordering them long term. Even if they get the price down below beef. This is the first time a burger replacement product feels like a legit contender (as far as being able to sustain and build customer satisfaction.)

I wonder what's gonna happen to turkey burgers  :P 
Title: Re: BYND - Beyond Meat
Post by: SHDL on June 11, 2019, 09:24:51 AM
The valuation looks pretty crazy now but this does tick a lot of boxes on my “do not short” checklist.

- Growing extremely fast, still very small.
- Tiny float.
- Stock is really hard/costly to borrow.
- Great product, potentially wide moat.
- Clearly identifiable group of people who will happily buy the stock just because they like the product and the company’s “mission.”
- Obvious acquisition target for giant CPG companies that are struggling to ride current consumer trends and grow.
Title: Re: BYND - Beyond Meat
Post by: Gregmal on June 11, 2019, 11:07:50 AM
This whole thing just screams fad to me. Lets face it, there is a certain ambiguity to the TAM here, but realistically, only a fringe number of people will stick with this. Hardcore "manly" men, the BBQers and whatnot, will never switch. Then there is the "oh that's cool" crowd, probably like myself. I tried the Impossible Burger, and it was good. But I'm not getting it every time I go out and order a cheeseburger. At last, there is the health crowd. But from everything I have read, this burger is basically on par with beef. There is no real health benefit to it. So the only place, long term for this(after everyone has gotten over the "its cool I need to try one" thing), is the vegetarian/vegan who doesn't really care "that much" about their health.

These things aren't replacing Big Mac's and aren't taking over the world. There is nothing really stopping knocks offs from emerging, and its hard to really get comfortable with future valuations when the current multiple is 100x sales. What price/sales ration does Lamb Weston trade at? Thats maybe where I'd be interested.

That said, outside of selling OTM calls, I think stuff like LWAY and CLXT might be tertiary plays with way more upside should this trend continue.
Title: Re: BYND - Beyond Meat
Post by: rkbabang on June 11, 2019, 12:21:02 PM
This whole thing just screams fad to me. Lets face it, there is a certain ambiguity to the TAM here, but realistically, only a fringe number of people will stick with this. Hardcore "manly" men, the BBQers and whatnot, will never switch. Then there is the "oh that's cool" crowd, probably like myself. I tried the Impossible Burger, and it was good. But I'm not getting it every time I go out and order a cheeseburger. At last, there is the health crowd. But from everything I have read, this burger is basically on par with beef. There is no real health benefit to it. So the only place, long term for this(after everyone has gotten over the "its cool I need to try one" thing), is the vegetarian/vegan who doesn't really care "that much" about their health.

These things aren't replacing Big Mac's and aren't taking over the world. There is nothing really stopping knocks offs from emerging, and its hard to really get comfortable with future valuations when the current multiple is 100x sales. What price/sales ration does Lamb Weston trade at? Thats maybe where I'd be interested.

That said, outside of selling OTM calls, I think stuff like LWAY and CLXT might be tertiary plays with way more upside should this trend continue.


I agree with almost everything you've said except that it is on par with beef.  It contains Canola Oil (3rd ingredient) as well as sunflower oil.  Someone who wanted to stay away from high omega-6 oils would choose a beef burger over this for health reasons.  The same with version 2 of the impossible burger, which uses sunflower oil as its main fat. 

I haven't tried either of these, but I'll probably try them eventually just out of curiosity.

As far as the stock goes, I think it is blown way out of proportion.  I've spoke to a vegetarian that I know who does not want to try these because she doesn't want the experience of eating meat.  And if you are not a vegetarian, then beef is arguably healthier.  So unless these become extremely cheep so people save money by choosing these over meat, or change their recipes (which might effect taste), I don't see this as anything but a fad as well.

I'm waiting for the lab-grown real beef.
Title: Re: BYND - Beyond Meat
Post by: aws on June 11, 2019, 02:30:55 PM
IB has the borrow rate at 384% right now, well over 1% per day.  Hard to imagine making money unless you just caught a day like today randomly.
Title: Re: BYND - Beyond Meat
Post by: snow pea on June 11, 2019, 04:11:22 PM
I am a vegetarian and have eaten beyond burgers (as well as a couple of their other products) a few times.  I don't particularly like them because they seem too meat-like to me.  There are probably other vegetarians for whom being more meat-like is not an attractive feature, so that may also limit the market, but I suspect that we're not a large portion of the vegetarian population.  My partner, who is also a vegetarian, does enjoy them quite a bit.  As do most others I've talked to them about, both vegetarian and not.
Title: Re: BYND - Beyond Meat
Post by: SHDL on June 11, 2019, 04:20:06 PM
On the product, I wonder how people who don’t eat beef for religious reasons feel about their burgers and sausages?  If this has the potential to do well in a place like, say, India, that changes things quite a bit.
Title: Re: BYND - Beyond Meat
Post by: CorpRaider on June 11, 2019, 05:08:11 PM
The big sales pitch, to my eye, is going to be environmental/sustainability (to include animal welfare).  I personally will probably eat an impossible burger one every month or two.  I'm not vegan or vegetarian.  I eat some poultry and fish.  I've seen some marketing data term for us flexi-vores or something like that.

Personally don't think the saturated fats content stuff will play outside of maybe boomer cardiologists.
Title: Re: BYND - Beyond Meat
Post by: Castanza on June 11, 2019, 06:43:15 PM
IB has the borrow rate at 384% right now, well over 1% per day.  Hard to imagine making money unless you just caught a day like today randomly.

Don't really play option that much. But do you think today's significant drop has anything to do with the "quiet period expiration"? That being said the IPO lockup is in Oct. Hard to imagine this bloat holding on that long, but it's not unreasonable to use those as potential target dates for shorts. I still don't have the cajones to do it. 
Title: Re: BYND - Beyond Meat
Post by: aws on June 11, 2019, 08:03:27 PM
IB has the borrow rate at 384% right now, well over 1% per day.  Hard to imagine making money unless you just caught a day like today randomly.

Don't really play option that much. But do you think today's significant drop has anything to do with the "quiet period expiration"? That being said the IPO lockup is in Oct. Hard to imagine this bloat holding on that long, but it's not unreasonable to use those as potential target dates for shorts. I still don't have the cajones to do it.

I don't think it was the quiet period, just the downgrade from JP Morgan on an obviously overheated stock.  I don't think there's any good way to profit from shorting for as long as the demand to short is so high.  Just like the borrow rate makes shorting the stock exorbitantly expensive, it also skews the put/call parity dramatically which makes options unlikely to be profitable.  For example, with the stock at 126 the November $125 puts were trading at 46 vs 18 for calls of the same strike even though it's the calls that are in the money.  If you buy the puts you need a 37% drop to breakeven, and if you short the call you get paid little relative to the volatility and risk getting blown out if the stock spikes and triggers early assignment, which then subjects you to the insane short borrow fee.
Title: Re: BYND - Beyond Meat
Post by: BG2008 on June 21, 2019, 04:49:22 PM
BYND obviously trades at crazy multiples to revenue.  Let's not bother with P/FCF or EV/EBITDA.  But I have been tinkering with the thought that BYND's constraint on revenue growth is actually on the supply side as they can't keep up with demand.  What is interesting is that places like Burger King is rolling it out.  It is different when there is a small chain of 20 restaurants that want to put it on the menu.  But when Burger King want to roll it out to its foot print of 7,406 locations, the revenue will likely J Curve.  I am not saying that the valuation is defensible.  What I am saying is that the P/Sales is probably not as ridiculous as it actually looks. 
Title: Re: BYND - Beyond Meat
Post by: gfp on June 21, 2019, 04:58:03 PM
Burger King is rolling out Impossible Foods’ product. It’s a different company

BYND obviously trades at crazy multiples to revenue.  Let's not bother with P/FCF or EV/EBITDA.  But I have been tinkering with the thought that BYND's constraint on revenue growth is actually on the supply side as they can't keep up with demand.  What is interesting is that places like Burger King is rolling it out.  It is different when there is a small chain of 20 restaurants that want to put it on the menu.  But when Burger King want to roll it out to its foot print of 7,406 locations, the revenue will likely J Curve.  I am not saying that the valuation is defensible.  What I am saying is that the P/Sales is probably not as ridiculous as it actually looks.
Title: Re: BYND - Beyond Meat
Post by: BG2008 on June 21, 2019, 05:06:40 PM
Burger King is rolling out Impossible Foods’ product. It’s a different company

BYND obviously trades at crazy multiples to revenue.  Let's not bother with P/FCF or EV/EBITDA.  But I have been tinkering with the thought that BYND's constraint on revenue growth is actually on the supply side as they can't keep up with demand.  What is interesting is that places like Burger King is rolling it out.  It is different when there is a small chain of 20 restaurants that want to put it on the menu.  But when Burger King want to roll it out to its foot print of 7,406 locations, the revenue will likely J Curve.  I am not saying that the valuation is defensible.  What I am saying is that the P/Sales is probably not as ridiculous as it actually looks.

Facepalm
Title: Re: BYND - Beyond Meat
Post by: BG2008 on June 21, 2019, 05:07:20 PM
Burger King is rolling out Impossible Foods’ product. It’s a different company

BYND obviously trades at crazy multiples to revenue.  Let's not bother with P/FCF or EV/EBITDA.  But I have been tinkering with the thought that BYND's constraint on revenue growth is actually on the supply side as they can't keep up with demand.  What is interesting is that places like Burger King is rolling it out.  It is different when there is a small chain of 20 restaurants that want to put it on the menu.  But when Burger King want to roll it out to its foot print of 7,406 locations, the revenue will likely J Curve.  I am not saying that the valuation is defensible.  What I am saying is that the P/Sales is probably not as ridiculous as it actually looks.

Facepalm

Facepalm, but principle still applies while thinking about P/S of both Beyond and Impossible
Title: Re: BYND - Beyond Meat
Post by: Zorrofan on June 22, 2019, 10:40:03 AM
Spokesperson for a consumer group was on CNBC warning about the chemicals used in the processing of pea protein, a major component in "Beyond Meat".

https://www.consumerfreedom.com/2019/05/5-chemicals-lurking-in-plant-based-meats/

https://www.cnbc.com/video/2019/06/21/beyond-meat-down-after-consumer-group-warns-of-chemicals-in-fake-meat.html


Title: Re: BYND - Beyond Meat
Post by: roark33 on June 22, 2019, 10:45:25 AM
https://www.sourcewatch.org/index.php/Center_for_Consumer_Freedom

Given that this "watchdog" was and is still primarily funding by the tobacco industry, I am not sure how much weight should truly be given to their statements about health. 
Title: Re: BYND - Beyond Meat
Post by: DTEJD1997 on June 22, 2019, 10:50:48 AM
Hey all:

I tried some Beyond meat product the other day.

Definitely a VERY mixed product.  The firmness/texture was pretty good.

It had an odd taste though...I don't see how anybody could be fooled into thinking that this is actually meat by itself.  If it were in spaghetti sauce or chili or had some other strong flavors mixed with it, then MAYBE.

It was also unfortunate that it left an aftertaste, kind of a chemical taste.

Overall, it might be better than some of the competing meat substitutes, but it is also very expensive.  It was the most expensive protein choice on the menu!  Steak was cheaper.

An interesting product, but I don't think it is going to take massive market share anytime soon.

I will try it somewhere else, maybe BK might have a better taste/experience?
Title: Re: BYND - Beyond Meat
Post by: Deepdive on June 22, 2019, 09:44:41 PM
Beyond Meat brings back memories of the tech bubble.  Tech companies are actually much higher in quality this time around despite not being profitable at the time of IPO. 
Title: Re: BYND - Beyond Meat
Post by: Gregmal on June 23, 2019, 12:20:39 PM
Whenever I go to Costco I grab a box of the Morningstar Chipotle Bean Burgers. Very good, probably better than the Beyond Meat product or the Impossible Burger which I do like. Nevertheless I also still eat regular burgers, and it isn't taking share of anything for me other than perhaps one lunch meal a week.

Key question, why isn't Kellog stock going bananas?
Title: Re: BYND - Beyond Meat
Post by: Castanza on June 23, 2019, 01:52:10 PM
Whenever I go to Costco I grab a box of the Morningstar Chipotle Bean Burgers. Very good, probably better than the Beyond Meat product or the Impossible Burger which I do like. Nevertheless I also still eat regular burgers, and it isn't taking share of anything for me other than perhaps one lunch meal a week.

Key question, why isn't Kellog stock going bananas?

Greg, that is a simple yet important insight about Kellogg. However, I think part of the difference lies in the marketing of the product. Yes, Beyond Meat is marketed as a healthy alternative to meat. But I think the core of their marketing is on the sustainability of the product. I rarely see the company discussed without the sustainability and environmental aspects being mentioned. I think this really "sells" it to the millennial and younger generations. I think people have a bit of an irrational fear when it comes to sustainability. For some reason everyone thinks eating meat is killing the world. I won't disregard the harmful nature of industrial farming (some aspects) as there are some things that need to be changed. It seems that any company who markets themselves on the "wave of green" translates well with the younger generations. Long story short, it's way over valued, isn't as good (healthy or taste wise) as everyone says and is simply surfing the green wave. Every wave meets the shore eventually.

Also Kellogg is one of those big evil conglomerate corporations that millennials love to hate.  :P
Title: Re: BYND - Beyond Meat
Post by: Deepdive on June 23, 2019, 05:09:10 PM
Beyond Meat is pure play and Kellogg's bean burger probably doesn't move the needle much
Title: Re: BYND - Beyond Meat
Post by: Gregmal on June 23, 2019, 05:35:00 PM
Beyond Meat is pure play and Kellogg's bean burger probably doesn't move the needle much

My remark was largely sarcastic. In terms of EV, Kellogg is about 28B, while BYND is just under $10B.  Morningstar Farms certainly isn't valued properly!(again sarcasm).

My gist; this is the definition of a fad. 100%. Has nothing to do with the market being in a bubble or anything else. The key for these companies is to follow the Sodastream model. Hoard as much cash as possible during your fad years, and then hope to reposition the business in as strong a position as possible once things normalize. Most fads piss away their money in good times, and then lose money when the boom is over(SCTY). I dont see this as being much different. FIZZ is another one.
Title: Re: BYND - Beyond Meat
Post by: Jurgis on June 24, 2019, 10:12:36 AM
Bought BYND sausages and burger @ Wegmans. Did not like the sausages.  :( Trader Joe's veggie sausages taste better for me. Did not try the burger yet.
Title: Re: BYND - Beyond Meat
Post by: rkbabang on June 24, 2019, 12:57:49 PM
I wonder if Beyond Meat can survive now that their nefarious plot to change human DNA has been exposed.

Meatless burgers are Satan's work
https://boingboing.net/2019/06/17/meatless-burgers-are-satans.html
Title: Re: BYND - Beyond Meat
Post by: Jurgis on June 24, 2019, 01:52:24 PM
Now I'm in a bynd... I'll have to eat their sausages to do Lucifer's (TM) work on Earth... even if I don't like them.  ::)
Title: Re: BYND - Beyond Meat
Post by: tooskinneejs on June 24, 2019, 01:53:23 PM
I had a Beyond burger this weekend.  Thought it was somewhat similar to a beef burger, but overall didn't think it was anywhere near as good as the hype surrounding it.  I honestly can't say I would choose it over any of the dozens of other veggie burgers out there.
Title: Re: BYND - Beyond Meat
Post by: Liberty on June 24, 2019, 02:25:43 PM
I had a Beyond burger this weekend.  Thought it was somewhat similar to a beef burger, but overall didn't think it was anywhere near as good as the hype surrounding it.  I honestly can't say I would choose it over any of the dozens of other veggie burgers out there.

Expectations matter a lot with all subjective experiences (watching a movie, listening to an album, tasting a wine or scotch, etc).

I think that the hype and high expectations are doing a disservice to the company, though I'm not sure what they can do about it.

I tried a Beyond Meat burger from A&W a few weeks ago with pretty neutral expectations (maybe slightly on the high side), and I liked it. I thought it wasn't quite as good as the regular burger which I had side-by-side, but it's was tasty, and would probably have gone over even better without the direct comparison.

These things will keep getting better, and the end state is artificial meat that will be as good and eventually better (all cloned from the very best AAAA grass-fed Kobe beef but with Omega 3... healthier, and more ethical, and better for the environment (turning feedstock into meat isn't that efficient through an animal)) than the factory-farmed meat. Question is how long until we get there?

I like that this company is getting all the attention. Hopefully it attracts more competitors and smart people and capital to the field so that this transition happens faster.

Like Tesla, no interest in it as an investment, but I find the technology/product very interesting, especially where it's going rather than where it is.