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Why Blue Apron Stock Soared Today

By Jeremy Bowman - Jul 16, 2019 at 12:08PM

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Shares of the meal-kit provider were gaining on a new partnership with Beyond Meat.

What happened

Blue Apron ( APRN -3.07% ) stock was climbing the charts today after the struggling meal-kit service announced a new partnership with Beyond Meat ( BYND -4.08% ), the fast-growing plant-based protein company. 

Shares of Blue Apron were up 49% as of 11:13 a.m. EDT, while Beyond Meat had gained 3.5% on the news.

Meal ingredients including the Beyond Burger on a kitchen countertop.

Image source: Blue Apron.

So what 

Blue Apron said it would begin selling meal kits with Beyond Meat burgers and other of the company's products in August, including signature recipes featuring the patty like Caramelized Onion & Cheddar Beyond Burgers. 

CEO Linda Kozlowski explained the move, saying, "We know a growing number of customers are interested in plant-based proteins, whether as an alternative to meat, a desire to explore a new ingredient, or an opportunity to make more sustainable food choices." Ethan Brown, Beyond Meat's CEO, also touted the move, adding, "We're thrilled to partner with Blue Apron to empower consumers to prepare and enjoy delicious Beyond Burgers at home."

Now what

It's clear why Blue Apron would seek to tie its fortunes to Beyond Meat. The alternative meat company is seeing explosive growth as sales more than tripled in its most recent quarter as restaurants have jumped on the plant-based meat trend.  Blue Apron, on the other hand, has been losing customers for several quarters are now as the meal-kit trend seems to have fizzled amid intense competition and the questionable value of the product itself.

Blue Apron has launched such partnerships in the past, including with Weight Watchers and other diet trends like Whole30, but customers have continued to abandon the service.

Adding Beyond Burgers to the menu may please some Blue Apron customers, and it will help Beyond Meat by giving the company more exposure, but it seems unlikely to make enough of an impact on Blue Apron's business to justify today's surge.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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Stocks Mentioned

Blue Apron Stock Quote
Blue Apron
$11.36 (-3.07%) $0.36
Beyond Meat Stock Quote
Beyond Meat
$64.61 (-4.08%) $-2.75

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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