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All You Should Know Before Beyond Meat's (BYND) Q3 Earnings

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Beyond Meat, Inc. (BYND - Free Report) is likely to report a decline in the bottom line when it reports third-quarter 2020 numbers. The Zacks Consensus Estimate for earnings has moved down a cent in the past 30 days to 3 cents per share. Further, it suggests a 50% drop from the figure reported in the prior-year period. Additionally, Beyond Meat’s bottom line lagged the consensus mark by a wide margin in the last reported quarter.

Nonetheless, the Zacks Consensus Estimate for revenues is pegged at roughly $136 million, indicating an increase of 47.4% from the prior-year quarter’s reported figure.

Beyond Meat, Inc. Price, Consensus and EPS Surprise

Beyond Meat, Inc. Price, Consensus and EPS Surprise

Beyond Meat, Inc. price-consensus-eps-surprise-chart | Beyond Meat, Inc. Quote

Key Factors to Note

Beyond Meat has been benefiting from its strong distribution channel and gains from innovation. Markedly, the uniqueness of its plant-based meats has been a major demand driver. The company’s retail volumes have been particularly gaining on increased consumption amid coronavirus-led elevated stay-at-home trends. In the last reported quarter, the company’s volumes were driven by higher retail channel sales, stemming from domestic and international distribution gains, increased sales velocities for current retail customers and contributions from new products. This trend is likely to have continued in the quarter under review as well. Further, in its earnings call, management said that based on its second-quarter sales momentum, it is optimistic about its ability to capitalize on the opportunities ahead.

However, the foodservice channel has been sluggish amid the pandemic due to increased stay-at-home mandates in several regions, limited operations and temporary closure of a number of foodservice customers of Beyond Meat. Though many foodservice customers have reopened, they are operating as per local restrictions and continue to reel under an uncertain pandemic-led scenario. In its second-quarter earnings call, management said that it expects U.S. foodservice demand to remain soft through the rest of 2020 due to the continued rise in coronavirus cases. Apart from this, promotional investments and costs-related to COVID-19 are key concerns. 

What the Zacks Model Unveils

Our proven model doesn’t conclusively predict an earnings beat for Beyond Meat this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Beyond Meat currently has a Zacks Rank #4 (Sell) and an Earnings ESP of +113.04%.

Stocks With Favorable Combinations

Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season.

Nu Skin (NUS - Free Report) has an Earnings ESP of +3.54% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Newell Brands (NWL - Free Report) has an Earnings ESP of +0.33% and a Zacks Rank #2.

Church & Dwight (CHD - Free Report) has an Earnings ESP of +1.56% and a Zacks Rank #3.

5 Stocks Set to Double

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