From a fundamental perspective, Beyond Meat is one of the worst stocks in the entire market. Revenue growth has been paltry: The company expects the figure to reach about $330 million in 2025, roughly 10% higher than it was six years earlier despite a huge increase in the number of products offered.

Profitability is distant. In 2024, on an operating basis Beyond Meat lost 45 cents from every dollar of sales. The company’s current target is to reach EBITDA (earnings before interest, taxes, depreciation, and amortization) breakeven by the end of next year. But even that target, if reached, would still mean Beyond Meat is posting negative free cash flow.

That’s a problem given that $1 billion in convertible bonds come due in March 2027. Beyond Meat has no way to repay that debt, and the credit markets know it: The bonds currently trade at about 17 cents on the dollar.

In that context, the surprise is not that Beyond Meat stock is down 98% from early 2021 highs to an all-time low; it’s the fact that the stock has any value at all. Any purely financial model here would suggest that the equity is worth zero, and that in 2027 the Beyond Meat business will wind up in the hands of its bondholders.

But there are two reasons why Beyond Meat still has a market capitalization of about $240 million. The first is somewhat technical. Unsurprisingly given its financial profile, BYND has been a popular trade for short sellers, who borrow the stock and then sell it, betting that they will be able to buy back shares later for a cheaper price. The trade has been so popular that those traders have to pay a fee to borrow the stock — and a portion of that fee is passed on to most shareholders. Those fees won’t cover the current stock price, but they can be material.

The other reason is that there is still some hope that Beyond Meat can survive as a publicly traded company, even if that hope is quickly dwindling.

Beyond Meat stock is down by nearly 50% since the beginning of November.

At this point, bondholders might be amenable to some kind of deal that exchanges the maturing debt for (presumably) some combination of equity in the business and new debt. Counterintuitively, the low price of Beyond Meat debt actually helps the company’s negotiating position: current bondholders can take a seemingly raw deal in terms of what they’re owed, since there is essentially zero chance of the company repaying the bonds when they mature two years from now. Indeed, the Wall Street Journal reported last year that Beyond Meat was holding those discussions, and management on earnings calls has alluded to efforts as well.

Operationally, meanwhile, management still sees a path to a turnaround.

Revenue has grown year-over-year in each of the last two quarters, though admittedly volumes are still negative. Cost-cutting can provide some help in getting back toward breakeven, but the company needs consistent, significant revenue growth to return. (It’s difficult to remember now, but in 2019 Beyond Meat’s revenue increased 239% year-over-year.)

On that front, the company thinks improved perception can help. CEO Ethan Brown has alleged significant “misinformation and misdirection” about the health profile of plant-based meat, and Beyond Meat has gone on the offensive to refute claims that its products are too processed. Removing that perception ostensibly can drive volumes higher, get the company’s factories running at full capacity, and improve profit margins to the point where Beyond Meat can start getting cash in the door instead of sending it out.

More broadly, the case – or at least the hope – is that plant-based meat is still a viable category.

Beyond Meat’s stock price isn’t the only that has come down; rival Impossible Foods has seen its internal valuation come down by at least half, based on reporting from Bloomberg in 2023.

The year before, Kellogg announced plans to split into three companies, one of them being MorningStar Farms. By the time the details of the split were formalized the following year, the company admitted there was no way MorningStar was valuable enough to stand alone.

Yet there is still some demand for plant-based meat, even if that demand remains at a niche level. As Brown argues, it may simply take time for the category to recapture consumers – and to continue to improve its products. But the problem for Beyond Meat shareholders in that context is that, with the debt maturing, there isn’t enough time. On the current path, bondholders will take over the company via bankruptcy.

To be sure, the end of Beyond Meat stock doesn’t mean the end of the Beyond Meat business, let alone the end of the plant-based meat industry. A reorganized company can continue its work, and perhaps even go public again in the future (as have, for instance, many U.S. airlines).

But the disappointment of BYND stock clearly is a reflection of the disappointment of the industry as a whole. Beyond Meat’s plan was to change the world; yet it almost certainly won’t be able to pay its debts.

About the author: Vince Martin is an analyst and author whose work has appeared on multiple financial industry websites for more than a decade. He has no positions in any securities mentioned.

The Food Institute Podcast

How does one ride the skate ramp in CPG? Dr. James Richardson, author of Ramping Your Brand and owner of Premium Growth Solutions, shares some of the pitfalls many early-stage CPG brands make and highlights some of the pathways to success.