It has been a remarkable week for Beyond Meat Inc.
Shares of the plant-based meat substitute company have soared more than 20% this week, heading toward their biggest weekly gain since July and well outpacing the S&P 500’s 1.2% rise.
What’s driving the stock higher? For one, McDonald’s Corp. said Wednesday that it would expand its experiment in Canada with burgers using Beyond Meat-supplied patties. The fast food giant plans to sell the P.L.T. sandwich—short for plant, lettuce and tomato—at 52 restaurants in Ontario starting Jan. 14, up from an initial 28 locations last year.
Another piece of good news for Beyond Meat came Tuesday, when Reuters reported that rival meat-alternative creator Impossible Foods Inc. was dropping efforts to ink a deal with McDonald’s. Impossible Foods already has traction in the mainstream market, with Restaurant Brands International Inc.’s Burger King carrying its Impossible Burger in stores. But McDonald’s is a bigger brand globally. Investors responded positively to the news, sending shares up 12% Tuesday.
After all that, Beyond Meat shares were recently trading at $93.96, up 25% for the week.
Notably, that is still well below the highs the stock hit following its initial public offering in early May. Beyond Meat last hit a record on July 26, when it closed at $234.90—a stunning 840% rise from its IPO price of $25.
The takeaway? Large weekly gains—and losses—aren’t uncommon for a volatile stock like Beyond Meat. Last year, many traders piled into bets that Beyond Meat’s shares would fall, making it at points one of the most expensive stocks to borrow to bet against, according to financial analytics firm S3 Partners.
The result of experiments such as McDonald’s P.L.T. rollout in Canada will offer investors a clearer picture of whether Beyond Meat’s products will catch on enough among traditional meat eaters to keep generating growth.
Write to Akane Otani at akane.otani@wsj.com
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Beyond Meat’s Shares Are Having Their Best Week in Months - Wall Street Journal
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