On July 16, Blue Apron (APRN) announced that beginning in August, it will add Beyond Meat’s (BYND) products to some of its meal kits. The announcement had led Blue Apron’s stock to rise to a high of $13.65 before closing the day at $10.38, which represents a rise of 35.5% from its previous day’s closing price of $7.66.
Blue Apron will introduce Beyond Meat’s Beyond Burger in its Signature Two-Serving Plan. Beyond Burger is free of GMOs, soy, and gluten, and contains 20 grams of plant-based protein in a four-ounce patty.
Will APRN’s upward momentum continue?
Earlier, on December 20, Blue Apron announced a partnership with WW to provide customers with a weekly rotating selection of recipes. WW was formerly known as Weight Watchers International (WW). The new partnership and better-than-expected fourth-quarter earnings led the company’s stock price to reach a high of $24.60 on February 20.
However, APRN has erased all its gains and was trading 32.2% lower YTD. The declining sales and a shrinking customer base due to rising competition have caused Blue Apron stock to fall. This year, the company has underperformed the broader equity market, where the S&P 500 Index has increased by 19.8%.
On the other hand, Beyond Meat has been on a golden run since its IPO in May. As of July 16, Beyond Meat was trading at $172.59, which implies a rise of over 590% from its IPO price of $25. You can read more about Beyond Meat’s growth prospects in Analysts Expect Beyond Meat’s Revenue to More than Double in 2019.
Analysts’ expectations from APRN
For 2019, analysts expect Blue Apron to report revenue of $532.1 million. Year-over-year, APRN’s revenue is expected to fall 20.3% from $667.6 million in 2018. For the same period, analysts are projecting the company’s EPS to rise by 57.4% to -$4.02 from a loss of $9.45 in 2018.
This month, Goldman Sachs and Citigroup have both lowered their price targets for Blue Apron. On July 12, Goldman Sachs had slashed its price target from $18.75 to $8.0. Earlier, on July 11, Citigroup cut its price target to $8.0 from $18.0. From the graph above, we can see that analysts’ average price target for Blue Apron has been declining. On July 16, analysts’ price target for APRN stood at $12.92, which implies an upside potential of 24.4%. Overall, six analysts cover the stock, and all of them have given a “hold” rating for the stock.