Beyond Meat’s IPO May Not Sizzle
Alternative meat producer, Beyond Meat, has just upped its IPO valuation target by a whopping 20% to an ambitious $1.5bn, but have they overcooked it?
The eco-friendly company has generated quite the following and some impressive sales figures to match, but with a valuation of 17 times last year’s revenue, they may have bitten off a little more than they can chew.
In comparison, Lyft’s disappointing IPO came in at a 12 times multiple, but Beyond Meat is pulling in far stronger numbers. Revenue grew by 170% last year to $87.9m, and preliminary growth figures put its 2019 Q1 growth at a whopping 200%.
Even though the company is still making losses, it has managed to steadily decrease the red numbers quarter by quarter, while increasing the size of the company. However, they are not the only players in the space. Big names like Kellogg, Tyson and Impossible Foods are also on the plant-based alternatives train with substantial enough resources to derail Beyond Meat’s plans for world domination.
Even though a 15 times multiple would not be unheard of for a rapidly-growing food company, targeting the 17 mark leaves its IPO vulnerable to being undercut by its competitors and burning an investor or two. Let’s see if it sizzles or flops.
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