Short Squeeze Sparks Dramatic Climb
It’s been a remarkable stretch for Beyond Meat Inc. (BYND), a once low-priced stock that surged nearly 1,200% at its peak this week.
The plant-based meat producer closed last Friday at roughly $0.67 per share. By early Wednesday, October 22, its stock had rocketed to about $8.70 — a staggering leap of almost 1,200%.
Soon after, a wave of selling took hold, driving the price back down to around $3.35 per share by Wednesday afternoon — a decline of about 8% for the day, but still representing a gain of roughly 400% for the week.
Short Squeeze Takes Hold
The turbulent moves in Beyond Meat’s (BYND) stock mirror many of the hallmarks of a meme stock rally, spurred largely by a short squeeze.
Before this explosive rebound, Beyond Meat (BYND) shares had hit an all-time low, dropping to $0.55 last week following a debt restructuring announcement. That agreement involved the exchange of debt for 316 million new shares, leading to shareholder dilution. Analysts downgraded the stock, and short interest climbed as traders bet on further declines.
Momentum shifted this week when Beyond Meat (BYND) revealed an expanded partnership with Walmart (WMT) to carry products like its Beyond Burger 6-Pack, Beyond Chicken Pieces, and Beyond Steak Korean BBQ-Style in more than 2,000 Walmart stores.
Adding to the excitement, the stock was also included in the Roundhill MEME ETF. These two developments triggered renewed buying, forcing short sellers to cover their positions — creating a feedback loop that sent shares soaring.
"These things kind of take on a life of their own – whether it’s short covering or people jumping on board, the effect is the same," said Joseph Saluzzi, partner at Themis Trading. "Everybody is looking for the next momentum move, and this happens to be the flavor of the day. I wouldn’t be shocked if a few others start to pop."
Proceed with Caution
As with any meme-stock-style rally, investors should approach Beyond Meat (BYND) with care. While the Walmart expansion offers a positive spark, the company remains unprofitable and continues to face challenges in sustaining revenue growth. In the second quarter, it generated about $75 million in revenue, a 20% year-over-year drop, and posted a net loss of $29 million (or $0.38 per share).
Beyond Meat remains a well-known player in the plant-based protein space, with supply partnerships across major restaurant brands such as McDonald’s, Denny’s, and TGI Friday’s, along with widespread grocery distribution.
Still, the company’s stock has shown itself vulnerable to dramatic swings — as this week’s volatility illustrates. Shares were sliding sharply by Wednesday afternoon, suggesting that investors might want to wait for stability before reassessing. Additional insight into its longer-term outlook should arrive with its Q3 earnings report on November 4.