Shares of Beyond Meat (BYND 3.41%) were falling 5.5% heading into noontime on Thursday after an analyst at J.P. Morgan said McDonald's (MCD 0.68%) was discontinuing its test in U.S. markets of plant-based burgers because they weren't selling.
In a research note to investors, analyst Ken Goldman titled his report McPlant Seems McDone in the US for Now, according to Thefly.com.
The McPlant was launched with great fanfare last November, an initially troubling development in that the fast food giant had opted to brand the burger with a name that hid the Beyond Meat sourcing. Still, its introduction into the largest restaurant chain in the world held significant potential for growth.
Yet McDonald's apparently experienced what is occurring elsewhere in the industry as Beyond Meat's foodservice sales declined 7.5% in the first quarter. Internationally, such sales were down 8%. The plant-based meat substitute company also reported much wider losses for the period.
It's not a good look for Beyond Meat, with its highest-profile customer dumping its product. Goldman told investors even if analysts don't materially alter their estimates because of McDonald's decision, it becomes difficult to expect the stock of the meat-alternative maker to grow very much, if at all. It's not as if the market was expecting great things anyway. Beyond Meat shares have lost half their value in 2022 and are down 77% over the past year.