Beyond Meat Fries Short Sellers, Soaring 20% After McDonald Launches Its Burgers In Canada
On Thursday morning Beyond Meat punished short-sellers, again, this time with a press release, stating that it has signed an exclusive agreement with McDonald's to test new plant-based burgers in Canada.
McDonald's will be conducting a 12-week test of a new plant-based burger called the P.L.T. (Plant. Lettuce. Tomato). The new P.L.T. will be available in 28 restaurants across Southwestern Ontario, starting next Monday [September. 30].
"McDonald's has a proud legacy of fun, delicious and craveable food—and now, we're extending that to a test of a juicy, plant-based burger," said Ann Wahlgren, McDonald's Vice President of Global Menu Strategy. "We've been working on our recipe, and now we're ready to hear feedback from our customers."
The P.L.T. has no artificial colors, artificial flavors, or artificial preservatives, it's a great-tasting "open wide and sink your teeth into it" sandwich, said, Wahlgren, adding that it'll be priced around $5.
Shares of Beyond Meat were up nearly 20% on light volume at 7:37 am est., while McDonald's was flat.
As of September 12, short interest in Beyond Meat was 5.452 million, or a whopping 42% of the float, explains why any press release with a major fast-food chain can pop the stock on relatively low volume.
Short interest has declined fractionally since hitting a record high in mid-August, perhaps an indication that the hedge fund community had suffered bigly in shorting the stock when it rocketed +257% from May to July, and has since fallen into late summer.
However, the squeeze is clearly still one with a borrowing rate well into the triple digits: Ihor Dusaniwsky, managing director of predictive analytics at S3 Partners tweeted Tuesday that Beyond Meat "is still a short squeeze candidate. Shorts are down $697mm in year-to-date mark-to-market losses & stock borrow rates are 114% of existing shorts & over 200% fee on new stock borrows - a rally would probably squeeze some shorts out of their losing and expensive shorts."
Yes, $BYND is still a short squeeze candidate. Shorts are down $697mm in year-to-date mark-to-market losses & stock borrow rates are 114% of existing shorts & over 200% fee on new stock borrows - a rally would probably squeeze some shorts out of their losing and expensive shorts https://t.co/DdIpNQYQwW
— Ihor Dusaniwsky (@ihors3) September 24, 2019
When Beyond Meat soared over 150 to 220 per share earlier this summer, people in New York, New Jersey, Florida, and California were Googling how to short the company.
As far as global tests of its plant-based burgers, Beyond Meat likely has a war chest of press releases to punish short-sellers, but as we might add, once the press releases become ineffective in driving short-covers, then lookout, the stock will crater.
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