Beyond Meat's stock is in the midst of a monster short squeeze.
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Shares of the plant-based burger maker are surging after a collaboration between Snoop Dogg and Dunkin with its products, but short-sellers aren't giving up their bets that the stock price is headed for a fall. Short interest in Beyond Meat climbed by 194,000 shares on Monday, and all told, accounts for about 40 percent of the stock.
|BYND||BEYOND MEAT INC.||109.12||-1.28||-1.16%|
“Shorts will be hanging onto their positions even in the face of these rallies and the resulting large losses, but at some point, risk and loss limits must be respected and short squeezes will occur,” Ihor Dusaniwsky, managing director at the financial-analytics firm S3 Partners, told FOX Business.
Ill-timed short bets against Beyond Meat have produced $587 million in mark-to-market losses this year, including $189 million on Monday alone, according to S3 data. Short-sellers betting against the company were saddled with $391 million of losses in 2019.
The announcement by Snoop Dogg and Dunkin of a limited-release Beyond Meat sausage sandwich drove shares up by 19 percent on Monday, and that's just one of several recent milestones. Subway Canada, Pollo Tropical and On the Border have also agreed to use Beyond Meat foods while McDonald’s Canada said it's expanding its global test of the plant-based burger to 52 restaurants.
Beyond Meat is scheduled to report its fourth-quarter earnings on Jan. 27. Wall Street analysts surveyed by Refinitiv are expecting profit of 1 cent a share on revenue of $76 million.
Shares have climbed 51 percent this year through Monday. They gained 64 percent from their May 2 debut through the end of 2019, despite failing to maintain a peak of $239.71.