What happened
Shares of Beyond Meat (BYND 0.16%) were pulling back today after the plant-based meat company reported several insider sales after hours yesterday.
The sell-off came just a day after the stock gained on talk of a strengthening relationship with McDonald's.
As of 3:10 p.m. ET, Beyond Meat stock was down 5.5%.
Image source: Getty Images.
So what
The company reported a number of insider transactions last night. Among those was one by CEO Ethan Brown, who sold 608 shares, or roughly $40,000 worth of stock, which represents just a small fraction of his total holdings of roughly 1.6 million shares. Elsewhere, Chief Legal Officer Teri Witteman sold approximately 8,000 shares, or about $500,000 worth of stock. However, several other executives bought stock, including the CFO, chief operating officer, and chief growth officer, meaning the insider sales do not seem to be a concerning sign.
Investors may have also sold the stock in reaction to yesterday's gains, thinking it may have been overbought. The stock finished up 9.3% on reports that McDonald's may be planning to launch the McPlant burger late in the first quarter of 2022, earlier than industry watchers had expected.
Finally, Beyond Meat shares may have been weak due to expectations that the Federal Reserve would tighten its monetary policy, which is seen as problematic for high-priced growth stocks like Beyond Meat as higher interest rates tend to lead to lower valuations. The central bank confirmed those worries this afternoon when it said that it could raise interest rates as many as three times next year.
Now what
Beyond Meat has long been a volatile stock as it represents a risky bet on the plant-based meat trend. Its early growth has been sapped by the pandemic and mixed results in restaurants, and the stock still trades at a price-to-sales ratio of around 10, which is a rich valuation for a consumer-facing stock.
Still, the response to the insider transactions today is mostly noise and shouldn't affect your investing thesis on the stock.
