What happened

Shares of Beyond Meat (BYND 1.17%) fell 6.7% on Monday, following an analyst downgrade. 

So what

On Friday, Citi analyst Wendy Nicholson began covering Beyond Meat's stock. She placed a sell rating and a $123 target price on its shares. The stock closed at $125.98 on Monday.

A bear is roaring.

Citi analyst Wendy Nicholson is bearish on Beyond Meat stock. Image source: Getty Images.

Although she recognized the benefits of Beyond Meat's "well-known brand" and strong position within the plant-based meat alternatives industry, Nicholson warned that intensifying competition -- from the likes of Impossible Foods and larger packaged food companies -- could weigh on its future growth.

Now what

Beyond Meat's shares had been on a tear before Nicholson's downgrade. Its stock price rallied sharply off its lows back in March, eventually rising more than 100% by June. Even after its recent swoon, Beyond Meat's shares are still up 67% year to date. 

Such rapid gains can often cause a growth stock's valuation to become a bit stretched, and that appears to be the case with Beyond Meat. Despite its recent pullback, its stock is trading at a lofty 17 times analysts' sales estimates for 2020. 

With Nicholson highlighting the risks that mounting competition could pose to Beyond Meat's expansion, investors appear to be growing more cautious about paying such a hefty price for its shares.