Beyond Meat more than doubled in value in its trading debut, giving the company a market capitalization of $3.9 billion. The company priced its IPO at $25 per share, the high end of its range, raising $241 million by selling 9.6 million shares. The stock closed at $65.75. Beyond Meat is trading on the NASDAQ under the “BYND” ticker.
Beyond Meat is located near Los Angeles in El Segundo, California. The food company is a maker of plant-based products that serve as a substitute for meat. Beyond Meat currently has burgers and other items at 12,000 restaurants including Carl’s Jr., A&W Canada, and TGI Fridays. The company also sells packaged food in grocery stores.
The stock price values Beyond Meat at about 44 times sales, based on last year’s revenue of $87.9 million. Generally, those kinds of multiple are only seen with the fastest-growing technology companies. Big food companies are usually valued at less than two times revenue. On the high end is Hormel at a multiple of 2.3 times sales. Food giant Tyson Foods is considerably lower with a multiple of 0.7.
It is clear that investors must be valuing the company based on its growth trajectory. Beyond Meat’s revenue doubled in 2017 and saw a 170 percent rise last year. Beyond Meat recorded a gross profit last year, but after factoring in all the research and development costs, as well as sales and marketing expenses, the company actually lost $30 million.
The big winner in Beyond Meat’s IPO is Obvious Ventures, founded by ex-Twitter CEO Ev Williams. Obvious Ventures owned just over 9 percent of the company, ahead of its public offering. Its stake is now worth more than $100 million, according to regulatory filings.