JP Morgan's Ken Goldman and James Allen downgraded the stock to "neutral" after a run that has cost short sellers US$400 million, according to the research firm S3.
"We're less confident in blended meat/plant products as we believe in the early stages of alternative meat, consumers want to make a simple binary decision between eating meat or not", the analysts said in a note.
Plant-based meat company Beyond Meat has had a volatile week, with share price dropping 25% on Tuesday.
JP Morgan has an overweight rating with a $120 price target.
'I am maniacally focused on driving this business forward through innovation, ' Brown said during a call with analysts discussing the company's first quarter earnings results. Goldman writes, "As we wrote last week, "At some point, the extraordinary revenue and profit potential embedded in Beyond Meat.will be priced in"we think this day has arrived". It's also facing increasing competition from other "new meat" companies like Impossible Foods.
Impossible Burger, which is already sold in more than 7,000 restaurants in the United States and Asia, recently raised $300 million in a financing round that valued the company at $2 billion. U.S. sales of plant-based meats jumped 42 per cent between March 2016 and March 2019 to a total of US$888 million, according to Nielsen.
It is ironic that in a year of high profile tech IPOs, it is a young food company, Beyond Meat Inc (NASDAQ:BYND), that has created the biggest splash, with its stock price increasing seven-fold from it offering price.
And demand is expected to continue to grow.
The alternative burger wars are escalating too, on the technological front.
This week, Beyond Meat will begin selling a "meatier" version of its plant-based Beyond Burger that's meant to look and taste like real hamburger.
It joins other food companies vying for a share of the USA alternative meat market which analysts estimate to be worth $100 billion by 2035 as consumers seek to reduce meat consumption amid growing concerns over health risks and environmental hazards of industrial animal farming. Smith maintained that Beyond Meat is an "incredible" company, and he noted it also sells meatless sausage and ground-up patties in addition to its pre-made burgers.