Imagine eating a veggie burger that actually tasted good. For the carnivores out there, it's hard to fathom. But that's exactly what Beyond Meat (NASDAQ: BYND) claims to offer with its unique, plant-based simulated beef. While the concept is a hard sell to die-hard meat lovers, fast-food restaurants are taking note.
Denny's (NASDAQ: DENN), a U.S. based restaurant operator, is giving Beyond Meat a chance. The diner announced Monday that it will be adding the company's vegetarian burgers to over 1,700 locations in the U.S. and Canada. Beyond Meat's stock was down 3.3% since the news and Denny's stock is flat from Monday.
But despite the tailwinds, Beyond Meat is working in a very competitive space with a small moat. And the company's valuation has attracted a large short interest (over 20% of its float). Will the simulated meat seller's breakneck revenue growth and improving fundamentals finally put its critics to rest? The Denny's deal suggests the answer is yes.