Why Is Wall Street So Bearish on Beyond Meat? There's 1 Key Reason.

Plant-based meat company Beyond Meat (NASDAQ: BYND) doesn't have a single buy rating from Wall Street analysts. Instead, a mix of hold, underperform, and sell ratings makes it clear that Wall Street is quite bearish on the stock. Some investors have been much less bearish recently, driving an incredible rally in October that eventually fizzled out.

Why is Wall Street so negative on Beyond Meat stock? A lack of competitive advantage is one key reason.

Image source: Beyond Meat.

Beyond Meat doesn't stand out from the pack

When demand for plant-based meat was on the rise, and before a slew of competitors entered the market, Beyond Meat was growing quickly. Enthusiasm for the category eventually faded, though, and competition intensified. Beyond Meat's brand was put to the test, and the result was a collapse in sales.

The fundamental problem is that Beyond Meat has no pricing power. The company sells what is essentially a commodity. Consumers now have many choices when it comes to meat alternatives, and that competition is eating Beyond Meat alive.

In the third quarter of 2025, Beyond Meat expects to report sales of $70 million and a gross margin of around 11%. Gross margin will be impacted by expenses related to ceasing operations in China. For comparison, Beyond Meat's revenue in the third quarter of 2021 was $106.4 million, and gross margin was 21.6%.

New products have failed to reignite sales. The company launched a jerky product a few years ago, but it was discontinued in 2024. Overall demand for plant-based meat has been weakening, and the company's strategy is now largely centered on cost-cutting.

It's tough to see a path forward

In the second quarter, Beyond Meat's U.S. retail channel suffered a 24.2% volume decrease and a 3.2% decline in revenue per pound. Higher trade discounts didn't prevent a steep volume decline, and with a rock-bottom gross margin, there's little room left to reduce prices further.

Wall Street appears right about Beyond Meat. Once a high-flying growth stock, Beyond Meat is now struggling to survive.

Timothy Green has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Beyond Meat. The Motley Fool has a disclosure policy.