More North Americans have adopted a vegetarian or vegan lifestyle over the past decade. There are many reasons for this shift. Many individuals have grown more health-conscious, spurring a major change in their diet. For others, the rising costs of meat make a vegetarian or vegan lifestyle the more practical choice. This has also led to major growth for meat substitutes.
Grand View Research recently valued the global meat substitutes market at US$12.9 billion in 2022. The same report projected that this market would reach US$234 billion by 2030. That would mean that the market will have delivered an impressive compound annual growth rate (CAGR) of 43% from 2023 through to the end of the forecast period.
Beyond Meat (NASDAQ:BYND) struck like a meteor when it launched its initial public offering (IPO) back in May 2019. Shares of Beyond Meat shot up to a still-record US$239.71 in July 2019. The stock had more than halved by the end of its IPO year. Its shares have suffered a steady decline since the summer of 2021, and is now trading in a single-digit price range. Beyond Meat inspired investors with its potential, but weak sales and successive pullbacks on its guidance caused investors to lose faith in its story.
Oatly (NASDAQ:OTLY) is a Swedish food company that produces alternatives to dairy products from oats, including oat milk. Shares of this stock followed a similar trajectory to Beyond Meat, as it soared out of the gate only to succumb to disappointing earnings and broader volatility.
Investors should be excited about the future of plant-based alternatives. However, this market is still young and those that want exposure to its potential should be very selective. Iād prefer to snatch up already established food producers who are easing into the market, like Hormel Foods (NYSE:HRL).
