Expectations are high for Beyond Meat's first earnings results

CNN/Stylemagazine.com Newswire | 6/6/2019, 9:12 a.m.

By Danielle Wiener-Bronner, CNN Business

(CNN) -- Beyond Meat will share its first earnings report on Thursday, and investors are eager to see if the fake meat maker is living up to the enormous hype surrounding it.

The company had a wildly successful initial public offering in early May. Since then, its stock has ballooned on sustained interest in plant-based protein, as well as Beyond's own momentum.

Tim Hortons announced in May that it is testing Beyond Meat's sausage patty in three of its breakfast sandwiches. Later that month, Beyond shared that it will start making its product in the Netherlands next year, in order to reach European customers more quickly.

Plus, Beyond Meat's stock has also gotten a boost when its competitor, Impossible Foods, announced new partnerships. Impossible has been struggling to meet the high demand for its product, suggesting that as interest increases in Impossible, more customers may turn to Beyond, as well.

Currently, Beyond is trading at about four times its $25 initial public offering price. And analysts think Beyond has even more potential.

Kevin Grundy, an analyst with Jefferies, pointed to more restaurant partnerships as potential drivers of growth. He suspects that McDonald's — which says it hasn't yet decided whether to introduce a plant-based protein item to US menus — could work with Beyond on a meatless product.

"We believe there is a high probability," of McDonald's launching a meatless product, he said, given that Burger King is selling an Impossible Whopper. If Beyond supplies meatless patties to McDonald's, he said, the company's value would grow.

Ultimately, Beyond could be a $5 billion-dollar business, according to JPMorgan analyst Ken Goldman. "We think plant-based meat can exceed $100 billion in sales in 15 years, with Beyond taking 5%," he wrote in a recent note.

"Beyond is not a startup that can sell a lot of product but make no money," he added. "It is a legitimate manufacturer that, in our view, has a clear path to bottom-line and cash flow success."