Beyond Meat investors are seeing red Tuesday morning.
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Shares of the plant-based “meat” maker were down more than 16 percent in early trading after the company announced a secondary share offering of 3.25 million shares, wiping out more than $2 billion of investor wealth and dropping its market capitalization to $11.23 billion.
Beyond Meat has been a stock market darling since the pricing of its initial public offering at $25 a share on May 2. It opened for trading the following day at $46 and hit a high of $239.71 a share last Friday. At its peak, the stock was up more than 850 percent from where its IPO priced.
As part of the offering, existing shareholders will sell 3 million shares and the company will sell 250,000 shares. The offering would raise about $722 million in total if it were done at Monday’s closing price of $222.13 a share.
Monday’s announcement came alongside Beyond Meat’s second-quarter earnings report. The company posted a net loss of $0.24 a share, or $9.4 million, missing the $0.08 loss that Wall Street analysts were expecting. Revenue soared 287 percent versus a year ago to $67.3 million, which was better than the $52.7 million that analysts estimated.
On the company's quarterly conference call, president and CEO Ethan Brown said Beyond Meat increased its distribution to more than 53,000 points of sale worldwide -- up from about 30,000 points of sale at the time of its May IPO.
“We are very pleased with our second-quarter results which reflect continued strength across our business as evidenced by new foodservice partnerships, expanded distribution in domestic retail channels, and accelerating expansion in our international markets," Brown said in the earnings release.
"We believe our positive momentum continues to demonstrate mainstream consumers’ growing desire for plant-based meat products both domestically and abroad.”