Shares of Beyond Meat (NASDAQ:BYND) have been on quite the roller-coaster since their May 2019 initial public offering. After going public at just $25, the plant-based meat substitute producer skyrocketed to an all-time high of $239.71 within just two months. Then, after a secondary offering at $160, shares plummeted back to earth, falling into the $70 range by year's end.

However, after the initial rise and crash, Beyond Meat is on the upswing again, rising 77.2% in the first six months of 2020, despite the restaurant and food service headwind from the COVID-19 pandemic. While the current price around $127 is just over half of its all-time highs, that price is still more than five times its IPO price, and almost double where shares ended their first day of trading at $65.75. Not too shabby.

So, what's been behind the incredible hype for Beyond Meat? And is there really "meat on that bone," so to speak?

A plant-based burger patty on a bed of lettuce with a tomato and onion on top.

Beyond burgers are all the rage in 2020. Image source: Getty Images.

The only public "pure play" on a massive opportunity

Though it's not without competition, Beyond Meat is the only publicly traded "pure play" plant-based meat company. Its main pure-play competitor, Impossible Foods, is still private. Meanwhile, most of Beyond Meat's other competitors are brands that have either been developed within or acquired by other large traditional meat producers.

Being the only "pure play" in the market comes with advantages, both for reputation as well as the stock price. The scarcity of available options to play the plant-based trend puts Beyond Meat shares at a premium. You can see the same phenomenon in other futuristic pure-plays such as Tesla (NASDAQ:TSLA) with electric vehicles and Virgin Galactic (NYSE:SPCE) in private space travel.

Big-time growth

The U.S. traditional meat industry is a $270 billion-per-year business, and internationally, the traditional meat industry is $1.4 trillion. Obviously, plant-based meat is a tiny fraction of that, but it's growing fast.

The taste improvements in plant-based meat, along with greater awareness of the substitute product, is leading to some big-time growth rates. In the twelve weeks ended March 22 -- or, just before the pandemic, U.S. plant-based meat retail sales were up 54%; however, Beyond Meat is absolutely trouncing the overall category. Its retail sales growth during the same period was a stunning 190%, six times the growth rate of its nearest competitor. For the entire first quarter, Beyond Meat's revenue growth came in at a 141%, despite its food service business being heavily affected by COVID-19 lock-downs in the final two weeks of the quarter.

Why is Beyond Meat doing so much better than rivals? Besides having a very realistic taste, Beyond Meat has differentiated its marketing from others; most notably, it put its products in the meat section of grocery stores, side-by-side with traditional meat products, rather than the vegetarian/vegan section. That, combined with solid marketing and execution, has vaunted the "Beyond" brand into mainstream consciousness.

That mainstreaming strategy appears to be working, as retail sales have not only taken off, but the Beyond brand has attracted some big-time partners as well.

Big-time partners

While the retail grocery business is the company's largest segment, Beyond's food service segment is smaller but growing just as fast (at least before COVID-19). Already, Beyond Meat has inked high-profile partnerships with some of the most recognizable QSR and fast-food restaurants around, including Dunkin' Brands (NASDAQ:DNKN), Carl's Jr., Del Taco, Subway, KFC, and McDonald's (NYSE:MCD), among other big names.

The massive distribution reach of these partners has also put "Beyond" in front of many more people who might otherwise never have heard of the brand, adding yet another leg to the company's eye-opening growth rates.

Big-time endorsements

Along with attracting big-name brand partners, Beyond Meat has also done a great job of landing celebrity endorsements. As the COVID-19 pandemic broke out, a host of celebrity musicians and athletes participated in Beyond's charitable program to give out a million meals at no cost to front-line workers in the struggle against the pandemic.

On the recent conference call with analysts, CEO Ethan Brown also highlighted the particular endorsement of NBA player Chris Paul, who underscored the difference a plant-based diet has made in his physicality as an athlete:

If you look at him in the 2020 All Star game, the guy's 35 years old. He's turning 35, catches a dunk, right? And that he is maybe six foot two, right? And so after the game, he says, "I've attribute this to shifting over to a plant-based diet has given me more legs, essentially, right?" He doesn't have to ice his knees so many times, etc. So you're going to see us keep hammering home on that "got milk?" message, right? That you consume our product, you're going to feel better. It's going to do great things for you.

Celebrity endorsements are just another way Beyond Meat is mainstreaming its brand, and why everyone is talking about the company.

It's actually profitable

Finally, unlike so many high-growth stocks with wildly expensive valuations, Beyond Meat was actually profitable last quarter, not only on the manufactured "adjusted EBITDA" basis many tech companies like to use, but actually on a GAAP net income basis. In Q1, Beyond's massive growth came with a big-time gross margin expansion from 26.8% to 38.8%, and those increasing margins allowed the company to go from a $6.6 million net loss in the year-ago quarter to a $1.8 million net profit in the first quarter, despite making big investments in R&D and marketing expenses.

With operating leverage like that, investors can easily visualize big profits further down the road; it's yet another reason why Beyond Meat has been a market darling this year.

Beyond Meat stock is expensive, but it's the real deal

While no means cheap, at 25.3 times trailing sales and 770 times forward earnings, Beyond Meat is showing all the hallmarks of a category-killing stock in a new segment that's becoming more mainstream. Thus, while its valuation may make the stock subject to extreme volatility, the company appears poised for impressive long-term growth. It's a stock to keep on your radar in case of any material pullbacks.