Beyond Meat shares got a boost Thursday as McDonald’s expanded the test market of the McPlant burger to another 600 U.S. restaurants.
Beyond Meat (BYND) – Get Beyond Meat, Inc. Report shares lurched higher Thursday after McDonald’s (MCD) – Get McDonald’s Corporation Report said it would expand the test market for its plant-based burger starting next month.
McDonald’s said it would start offering the McPlant, a plant-based burger created in partnership with Beyond Meat, at around 600 test locations in U.S.-based restaurants, mostly in and around San Francisco and Dallas, beginning on February 14.
McDonald’s began testing the McPlant in November, and analysts have said a broader expansion across its network of 13,500 domestic sites could boost Beyond Meat sales, particularly if it is accompanied by a marketing and advertising push from the world’s biggest restaurant chain.
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The McDonald’s deal followed Beyond Meat’s recent marketing pacts with PepsiCo (PEP) – Get PepsiCo, Inc. Report and YUM! Brands (YUM) – Get Yum! Brands, Inc. Report — including a January 10 debut of ‘Beyond Meat Fried Chicken’ — which the group hopes will accelerate revenues following a disappointing third quarter, as well as its ongoing distribution partnership with Walmart (WMT) – Get Walmart Inc. Report, the world’s biggest retailer.
Beyond Meat shares were marked 2.5% higher in early Thursday trading to change hands at $64.30 each. McDonald’s, meanwhile, gained 0.55% to trade at $256.64 each.
Beyond Meat said in mid-November that current quarter sales would likely come in between $85 million and $110 million, well shy of the Refinitiv consensus of $132 million, as restaurants and grocery stores pare back orders amid softer consumer demand.
Labor, transportation and logistics issues linked to COVID-19, as well as a severe storm in Pennsylvania, clipped third quarter profits, too, with Beyond Meat reporting a wider-than-expected loss of 87 cents per share on sales of $106.4 million.
Short interest in the stock remains elevated, as well, with recent data from S3 Partners showing bets against the group totaling $1.34 billion, or 38.9% of the stock’s outstanding float.
