Plant-Based demand
BYND is the Best Idea SHORT
We received two data points yesterday about slowing demand for plant-based foods across USA and Canada. Both Kellogg and Maple Leaf Foods earnings calls talked about slowing consumer demand for plant-based products. But, as we said in our BYND deck, the most concerning statement from management was the recent press release was the following: While the company continues to study the drivers behind this quarter's performance."
Can we speculate BYND and the others (K & MFI) are trying to explain away the sudden shift in consumer demand? One theory is that consumers are wising up to the fact that the ingredients in the food are just not good for you!
SHAK is a BEST Idea SHORT
Nothing to get excited about for the LONGS. Trying to grow restaurant capacity above 20% in a labor-constrained, inflationary environment will never lead to outsized profitability! SHAK 3Q21 Non-GAAP EPS of -$0.05 beats by $0.01; GAAP EPS of -$0.06 beats by $0.01. Revenues missed, and same-store sales of +24.8% missed FS +27.8%, while Restaurant margin missed by (160bps) with food/paper costs +60bps higher than expected. The company guided 4Q21 revenue to $193.5M-$200M below FS $202.1M with Same-store sales mid to high teens vs. 2020 and restaurant-level operating margin 14-16%. FY21 expects to open 35-38 domestic company-operated Shacks and 25 both in line with guidence; reaffirms G&A $86-$88M.
