(Bloomberg) -- Beyond Meat Inc. shares rallied to a record high Friday after the faux meat-maker's inaugural earnings report impressed the Street and its better-than-expected annual outlook left even more room for possible gains, analysts said.
Beyond Meat shares soared as much as 36% to $135.80 each to a record high as of 9:39 a.m. in New York after its full-year sales outlook topped analyst expectations. The company said that the guidance was “very conservative,” and some analysts say potential upside leaves room for the stock to keep climbing.
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“Management made it very clear that its current forecast conservatively excludes customers that are only in the test phase,” Credit Suisse analyst Robert Moskow wrote, raising his price target to $125 from $70. “As a result, we expect revenue guidance to keep revising higher this year as the big chains like Tim Horton's transition out of test and into full market distribution.”
The stock has surged more than 400% since its initial public offering last month. Through Thursday, that left it trading at 15.5 times 2021 enterprise value to sales ratio compared with an average of 4.1 times for consumer growth companies, Jefferies said, maintaining a hold recommendation.
The El Segundo, California-based firm “remains one of the best stories in staples,” but with competition likely to intensify and a lofty valuation, “we'd wait for a pullback,” analysts including Kevin Grundy wrote in a note.
Jefferies raised its price target 24% to $105 a share, the second highest among analysts surveyed by Bloomberg. Jefferies is among seven analysts recommending investors hold the stock, while two say buy and none rate it a sell, according to data compiled by Bloomberg.
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To contact the reporters on this story: Courtney Dentch in New York at cdentch1@bloomberg.net;Joe Easton in London at jeaston7@bloomberg.net
To contact the editors responsible for this story: Beth Mellor at bmellor@bloomberg.net, Courtney Dentch, Celeste Perri
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