Beyond Meat’s Secondary Stock offering is not very appreciated by the markets, as the stocks fell by nearly 11% in a single day and 18% in a week. The company has priced the secondary stock offering at $160, which is six-times bigger than the IPO of the company, From Wednesday’s closing price of Beyond Meat Stocks, the current price is 18.6% down. Beyond Meats announced that they are up for the secondary stock offering with 3.25 million additional shares of the company. Amongst the 3.25 million shares, three million will come from the investors and 250,000 from the company itself.
According to the company, the secondary stock offering will help the company to raise $40 million. With the raised money, the company is expected to build new manufacturing plants to meet the robust demand for its products. Back in May, when the company went public with its IPO, the price of each share was $25. But in the secondary offering, the cost of each share is at $160, which is definitely at a premium. With the six-times the price of IPO, the stock market has not appreciated the move by Beyond Meat and stocks fell by 11% in a single day.
Not just the exorbitant pricing for the secondary offering, but the mixed quarterly results were behind the fall in the stocks of Beyond Meat. Even though the shares fell by 18% in a week, the company is still valued at $10.56 billion in the markets, 600% more valuable than at the time of IPO. Beyond Meat is not the traditional Meat producer, but it produces the Plant-based meat alternatives. Being Vegan meat manufacturer, the company is capturing almost every bit of demand from Vegan customers. With the increasing demand for its products, the company is collecting funds with a secondary offering for another plant-based meat manufacturing site.