Summary of "Why I've increased my price target on Beyond Meat (BYND)"

Summary

The video explains why the presenter has increased the price target on Beyond Meat (ticker: BYND) from $3 to $6 per share, highlighting both technical market dynamics and fundamental business improvements.

Market & Technical Analysis

Current Price & Trading Activity

BYND is trading around $4.5 after hours, surpassing the previous $3 target quickly.
Over 2 billion shares traded in one day, about 30x the company’s float, making it the most traded stock for three consecutive days.

Short Interest & Short Squeeze Dynamics

Despite the rally, short interest remains high; 57% of daily volume was sold short.
FINRA and Fintel data show short positions have not decreased; in fact, short interest may be rising.
Former bondholders who received shares are calling back loans of shares, reducing shares available to borrow (down to zero from 10 million).
Cost to borrow shares dropped to 45% annualized, indicating low lender willingness.
Retail investors dominate the shareholder base, tend to sell options rather than lend shares, reducing supply for shorts to cover.
Options volume surged 5x in one day, with nearly $200 million in put and call premiums traded during the rally—about 20% of BYND’s market cap.
Call options expiring soon price the stock between $5.50 and $6.50, indicating market expectations of further gains.

Implications

Shorts are forced to cover in a market where sellers prefer holding shares to collect high premiums (~10% weekly via options).
This dynamic fuels the short squeeze and upward price momentum.

Fundamental Business Improvements

Historical Context

Before bankruptcy risk concerns (2022-2023), BYND traded at an enterprise value (EV) of approximately $2.5 billion (~$6 per share current count).
At that time, the business was worse off:
- Gross margin: -5% vs. +12% today
- SG&A expenses: $230 million vs. $120 million today
- EBITDA: -$300 million vs. -$120 million today
Bankruptcy fears, not business deterioration, caused share price declines.

Debt Restructuring

Convertible note holders converted $900 million of debt and issued $200 million new convertible notes, improving the balance sheet.

Product & Operational Enhancements

Product reformulation:
- Simplified ingredients
- Switch to avocado oil base
- Saturated fat down 60%, sodium down 20%
- Improved taste and texture
- Healthier, less processed products addressing consumer criticism
Price reductions via Walmart expansion (value packs with six Beyond Burgers), improving affordability.
Production costs decreased over 18 months, expanding gross margin from -5% to +12%.
Walmart distribution expanded to 2,000+ stores, expected to boost Q4 and Q1 revenues and margins.
Launch of “Beyond Test Kitchens” enables rapid product development/testing, reducing inventory risk (currently over $100 million inventory).
Building direct-to-consumer (DTC) sales channel, improving revenue per unit and gross margins (wholesale discounts ~50% vs. retail).
Company owns production, warehousing, and logistics infrastructure, facilitating DTC growth.

Profitability Outlook

These improvements create a plausible path to EBITDA profitability for the first time in years.
Historically, BYND traded at much higher multiples during IPO years, suggesting potential upside.

Investment Framework & Recommendations

Price Target

$6 per share floor based on historical EV and improved fundamentals.
Short-term technical momentum could push price well beyond $6.

Risk Management Advice

Caution urged for investors with large gains (5x, 8x, 10x) and concentrated positions.
Suggested to trim positions by 5-15% to protect downside and convert some profits into risk-free capital while holding the remainder for potential further upside.
No clear top for the rally can be predicted.

Disclosures & Notes

The presenter owns approximately 4% of BYND’s float.
The analysis is not explicitly labeled as financial advice but includes cautionary notes on risk.
The rally and volume dynamics are compared to early GameStop (GME) short squeeze events.
The presenter thanks the community from Reddit and other forums for supporting the thesis since BYND traded at $0.50.

Tickers, Assets, and Instruments Mentioned

Ticker: BYND (Beyond Meat)
Instruments: Shares, convertible notes, put and call options
Sectors: Plant-based food, consumer packaged goods, retail distribution (Walmart)
Metrics:
- Price target: $6 per share
- Current price: ~$4.5 after hours
- Gross margin: from -5% to +12%
- SG&A: reduced from $230M to $120M
- EBITDA: improved from -$300M to -$120M
- Convertible debt: $900M canceled, $200M new convertible notes issued
- Options premiums traded: ~$200M (~20% market cap)
- Shares traded in one day: 2 billion (~30x float)
- Cost to borrow shares: 45% per year

Presenters / Sources

The video appears to be presented by an individual investor who has publicly disclosed a significant stake (~4%) in BYND and has been tracking the stock since it traded at $0.50.
References to data sources: FINRA, Fintel, Palanteer (logistics system developer).
Mentions community support from Reddit and other retail investor groups.

Conclusion

The price target increase on Beyond Meat reflects a combination of a strong technical short squeeze setup and meaningful fundamental improvements in product quality, cost structure, distribution, and balance sheet strength. This supports a sustainable valuation floor of $6 per share with potential for further upside. Investors are advised to manage risk carefully amid the volatile rally.