Despite recent reports of an Impossible Foods IPO, Beyond Meat is forging ahead with expansions into the Chinese market.
Yesterday, Beyond Meat’s (NASDAQ: BYND) biggest rival, Impossible Foods, announced its plans to potentially IPO within the year at a valuation of around $10 billion.
“But why are we talking about Beyond Meat?” I hear you ask…
A market leader in a growing industry
Impossible Foods may be the talk of Wall Street when it eventually goes public, but the fake meat industry is Beyond Meat’s playground and has been for a while now.
Sure, I’ve heard all of the bearish arguments before:
- Beyond’s supply issues.
- Increased competition from bigger players.
- Niche market.
Well, Beyond Meat’s moves this week take care of at least two of those issues, with Impossible reinforcing the bull argument for the remaining one.
Beyond Meat announced this week that it is manufacturing its first facility in China. That is a massive market for meat and, as consumers there become increasingly health-conscious, is expected to be big for meat substitutes too. Having an end-to-end facility there will enable Beyond to ‘meat’ growing demand — couldn’t resist, won’t apologize — and reduce costs. This could well prove to be the magic ingredient that allows them to start living up to their potential.
And it follows last year’s opening of a ‘plant’ — ok, that one was cheap — in the Netherlands, giving it more access to the lucrative European market. Suddenly, Beyond Meat has taken care of its supply issues in three of the world’s largest markets for meat substitutes. And with the global fake meat market estimated to reach a value of more than $8 billion by 2026, it is certainly no longer niche.
And as for an Impossible Foods IPO; name one successful company that didn’t have an arch-rival? Boeing has Airbus, Coke has Pepsi, Beyond has Impossible. The future is looking bright for plant-based burgers!
A MyWallSt subscription gives you access to over 100 market-beating stock picks and the research to back them up. Our analyst team post daily insights, subscriber-only podcasts and the headlines that move the market. Get your free trial now!
MyWallSt operates a full disclosure policy. MyWallSt staff currently holds long positions in companies mentioned above. Read our full disclosure policy here.