Next GameStop? This US Meme Stock Has Rallied 1000% In Five Days

Meme stock rallies have become commonplace in the US market lately, and the latest beneficiary of this trend has been Beyond Meat, a stock that has gained more than 1000% in the last five trading sessions, reports BBC.

The unprecedented rally comes even as the company struggles with sluggish sales, with Beyond Meat having yet to report a quarterly profit in over five years.

The spectacular rally over the week briefly saw the share price above $7 on Wednesday before closing down about 1% at roughly $3.60 amid volatile trading.

The rally in Beyond Meat, which produces and sells vegan meat products, started last week, marking the start of a stock movement reminiscent of rallies of GameStop and AMC in the past.

Momentum increased after Roundhill Investments added the company to its meme stock exchange-traded fund (ETF) on Monday, further contributing to a short squeeze, which forced investors to buy shares even if they were betting against the stock.

According to the Kobeiss Letter, Beyond Meat momentarily became a $3.5 billion company just six days after the company had reached its lowest valuation of $195 million.

The short squeeze added more upward pressure in the stock. But another key lever came when Beyond Meat announced a distribution deal with Walmart on Tuesday.

Mark Hackett, chief market strategist at Nationwide, called the Walmart deal a potential "transformational" catalyst that could help rebound demand.

However, Hackett cautioned that the deal "doesn't necessarily fix all the issues" and noted that current trading is based more on "emotions and technicals, versus fundamentals."

The stock eventually corrected, erasing 160% of gains. Despite the unprecedented rally, Beyond Meat's stock remains significantly below its 2019 peak of over $230.

As the week unfolds, it will be interesting to see if the stock can maintain its upward momentum.