It’s fair to say that the plant-based foods craze kicked off in earnest with the rise of Beyond Meat (NASDAQ:BYND). There are other businesses in this niche, of course, but the trading volumes of BYND stock prove that Beyond Meat is the leader in investable and digestible meatless fare.
And here’s what’s amazing about all of this. The Covid-19 pandemic, instead of throwing a wet blanket on the fake-meat trend, actually facilitated its growth as consumers turned their attention to their health and dietary habits.
It’s a development that not everyone expected, but many traders want to participate in. Yet, BYND stock seems directionless in 2021, at least so far.
That situation could change, though, as a supply shock in a very popular food category could provide a much-sought-after catalyst for Beyond Meat in 2021’s second half.
A Closer Look at BYND Stock
Interestingly enough, BYND stock traveled far but went absolutely nowhere from July 9, 2020, to the same day a year later.
Let me explain. Twelve months ago, the stock was trading near the $140 level. As of July 9, 2021, the share price was back at that same price.
However, there were sizable peaks and valleys along the way. The $200 mark has proved to be a strong resistance level, with BYND stock peaking there in October 2020 and January 2021.
There hasn’t been much price progress year-to-date, either. The tug-of-war between the buyers and sellers persists, but that $140 area is like a magnet.
To assuage anyone’s concerns, I’ll cite an old saying in the financial markets. It goes: the longer the base, the higher in space.
Is it possible that BYND stock has been basing for a huge run-up for a full year? Anything’s possible – and as we’ll see, a critical shortage could spur a surprise rally this year.
Playing Chicken
“We just don’t have quite enough chicken to meet the sudden demand.” That’s a quote from Craig Coufal, associate professor and Texas A&M AgriLife extension specialist.
Coufal’s complaint is emblematic of a perfect storm of events that has gripped the U.S. in a poultry shortage.
“You have kind of this smaller supply with this sudden, rapid demand for particularly white meat, breast meat, and wings here in the United States,” Coufal added.
What’s spurring this increase in demand? It’s hard to know for sure, but it may have something to do with the Covid-19 pandemic.
This event spurred a renewed interest in comfort foods, many of which include chicken as a main ingredient.
Meanwhile, February’s winter storm may have contributed to the supply contraction.
The consequences are dire for chicken lovers: some restaurants haven’t been able to meet demand, and prices have generally increased.
National Chicken Council spokesman Tom Super has even acknowledged a “very tight supply” in the chicken market. Is there a solution here?
No Meat, All Innovation
Coming to the rescue is Beyond Meat, with a plant-based alternative that could be healthier and more sustainable than chicken.
“We’re innovating the poultry market with the new Beyond Chicken Tenders,” proclaimed Beyond Meat Chief Innovation Officer Dariush Ajami.
This might sound bombastic, but there’s meat to Ajami’s claim. Beyond Chicken Tenders are made from ingredients like faba beans and peas – no chicken required.
These meatless tenders have 40% less saturated fat than the leading food-service chicken tender.
Moreover, they’re made with no GMOs, antibiotics or hormones. Plus, Beyond Chicken Tenders have no cholesterol.
Even beyond the nutritional benefits, these tenders offer “delicious taste and an exceptional culinary experience.”
Or at least, that’s what Ajami says. Only time will tell whether the cooks and customers agree. But you’ve got to respect Beyond Meat’s willingness to take on the traditional meat market.
The Bottom Line on BYND Stock
I’m not claiming that every restaurant is suddenly going to replace conventional chicken with Beyond Chicken Tenders.
There’s still a quiet revolution going on here, though. And BYND stock holders should continue to exercise patience, as 2021 could be the year when fake chicken takes a decidedly bullish turn.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
David Moadel has provided compelling content – and crossed the occasional line – on behalf of Crush the Street, Market Realist, TalkMarkets, Finom Group, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.