We Taste-Tested Burgers From Beyond Meat, Impossible Foods, and Real Beef. Here's What We Found. - Barron's

Photograph by Michael Thomas/Getty Images

As alternative meats proliferate in U.S. supermarkets and restaurants, consumers can begin comparison-shopping. Being choosy allows people to pick their favorite brands (and it can help investors can pick their favorite stocks).

“You should try the Impossible Burger and a Beyond Burger and a regular burger and see what you think,” Impossible Foods Chief Financial Officer David Lee had suggested to Barron’s. “The Impossible Burger is compelling versus cow.”

Impossible Foods is an alternative meat startup, like Beyond Meat (ticker: BYND), which was founded in 2011 by Ph.D. and MD Patrick Brown.

The opportunity to expense lunch sounded like a good idea, so that’s just what we did. More on the Barron’s blind tasting in a minute.

Barron’s reached out to Impossible Foods to gain more insight into the growing market for alternative meats. Investors have wrestled with issues such as market size and growth rates since the ultrasuccessful IPO of Beyond Meat on May 2.

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Lee was kind enough to answer our questions about the market. But he doesn’t think the opportunity for Impossible Foods’ products is limited to a small, vegan niche.

“The vast majority of people who eat Impossible Burgers are avowed carnivores,” says Lee. “This is a $2 trillion global market for meat and dairy and there is a longstanding desire for meat eaters to have something they feel better about.”

Lee says Impossible Foods’ technology is what sets the company apart. “[Impossible Foods] is applying new technology to a centuries-old [animal husbandry] industry that hasn’t been disrupted.” The company has a patented process to produce the heme molecule—an iron-containing compound found in animals (and in plants). Heme is designed to give Impossible Foods products the color, texture, flavor, and flexibility of actual animal protein.

Barron’s witnessed the application of the heme-based technology when we attempted to conduct our blind tasting. Our approach was unscientific. In fact, one of our main lessons is it’s hard to keep people away from free food.

We tasted three burgers, one from Beyond Meat, another from Impossible Foods and one traditional bovine-based burger. All three had the same bun, cheese, and toppings, and all were purchased from a nearby Bareburger.

All tasters correctly identified which burgers were plant-based and which were cow-based. Even though people weren’t fooled, the flavor feedback on the Impossible Burger and the Beyond Burger ranged from good to great.

This wasn’t Barron’s first foray into alternative-meats tasting. Our first attempt was unscientific, too. Jack Hough tried an Impossible Burger with his family at Red Robin Gourmet Burgers (RRGB) last week. The Impossible Burger passed the test, but despite the flavor success Hough prefers shares of traditional protein producers to Beyond Meat.

Beyond Meat is, after all, valued at more than 45 times 2018 sales.

Valuing high-growth companies is always hard. It’s not only coming up with a sensible price target, investors are often forced to endure high volatility when purchasing shares of newly public companies. Pinterest stock (PINS), for instance, advanced 80% from its $19 IPO price before dropping 13.5% when the company reported first-quarter numbers last week. Pinterest stock is down 24% from their peak, but are still 37% higher than their public offering price.

Beyond Meat stock has seen some volatility too. It dropped almost $4 Friday after a short seller tweeted incredulity about the company’s $4 billion market value. Beyond Meat stock closed at $86.09 Monday, down 11% from its high, but still 244% higher than the $25 IPO price.

Avoiding that kind of market drama may be one reason Lee says Impossible Foods has no plans to go public. With $300 million in the bank, raised last week from private investors, the company won’t feel pressure to sell shares to the public soon.

Investors who prefer the taste and texture of Impossible Foods will have to stick with Beyond Meats if they want exposure to alternative-meat protein in their portfolios.

By the way, we know we haven’t answered the big question. Which burger was better? You are going to have to decide that for yourself.

Write to Al Root at allen.root@dowjones.com

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