Packages of Beyond Meat plant-based burger patties are displayed for a photograph in Tiskilwa, Illinois, April 23, 2019.
Daniel Acker | Bloomberg | Getty Images
Bernstein downgraded shares of Beyond Meat Wednesday on valuation concerns, joining J.P. Morgan as the latest Wall Street analyst this week to cool on the red hot IPO. There are now no analysts on Wall Street that recommend buying Beyond Meat, a rare phenomenon for a company that just went public last month and comes as a result of its monster run outpacing even the must bullish expectations.
“The downgrade is driven by valuation considerations as the stock has traded in a highly volatile manner since its IPO likely due to its limited public float and is now trading at ~31x EV/NTM Sales, implying limited upside potential from a valuation perspective,” wrote Bernstein’s Alexia Howard.
Bernstein goes to market perform from outperform. However the firm upped its price target to $123 from $107. There are now zero “buy” ratings on Beyond Meat and eight “hold” ratings, according to FactSet. No one says “sell.”
Beyond Meat shares dropped 25% to $126.04 on Tuesday after J.P. Morgan, a lead underwriter of the IPO, downgraded the stock. “This downgrade is purely a valuation call,” the J.P. Morgan note stated.
Beyond Meat shares were up more than 600% from its $25 IPO price through their intraday high on Monday before the two downgrades this week, with the rally driven by rising expectations of wider acceptance of the alternative meat and more deals with restaurants. The company on Tuesday released a “meatier” version of its burgers. The shares began trading on May 2nd.
“Despite the valuation considerations, we continue to expect significant growth potential in the plant-based meat category and believe that Beyond Meat is well positioned as one of the frontrunners leading the new wave of plant-based meat products,” Bernstein added.
Shares are up 9% to $137.96 in early market trading.
— With reporting by Michael Bloom
North Korea says denuclearization off negotiating table with US
U.S. President Donald Trump meets with North Korean leader Kim Jong Un at the demilitarized zone separating the two Koreas, in Panmunjom, South Korea, June 30, 2019.
Kevin Lamarque | Reuters
North Korea’s ambassador to the United Nations said on Saturday that denuclearization is off the negotiating table with the United States and lengthy talks with Washington are not needed.
Ambassador Kim Song’s comment appeared to go further than North Korea’s earlier warning that discussions related to its nuclear weapons program, the central focus of U.S. engagement with North Korea in the past two years, might have to be taken off the table given Washington’s refusal to offer concessions.
Kim said in a statement that the “sustained and substantial dialogue” sought by the United States was a “time-saving trick” to suit its domestic political agenda, a reference to U.S. President Donald Trump‘s 2020 reelection bid.
“We do not need to have lengthy talks with the U.S. now and denuclearization is already gone out of the negotiating table,” he said in the statement made available to Reuters.
The U.S. State Department did not immediately respond to a request for comment.
Tensions have risen ahead of a year-end deadline set by North Korea, which has called on the United States to change its policy of demanding Pyongyang’s unilateral denuclearization and demanded relief from punishing sanctions.
North Korean leader Kim Jong Un has warned he could take an unspecified “new path” next year, raising fears this could mean a return to the nuclear bomb and long-range missile testing suspended since 2017.
On Tuesday, North Korea’s Foreign Ministry repeated a call for Washington to change its “hostile policies” and said it was up to Washington to decide what “Christmas gift” came at the end of the year.
Kim Song also hit out at a statement this week from EU members of the U.N. Security Council criticizing recent short range launches by North Korea, calling it a “serious provocation” against Pyongyang and saying they were playing the role of “pet dog” of the United States.
Trump and Kim Jong Un have met three times since June 2018, but talks have made little progress and recent days have seen a return to the highly charged rhetoric that raised fears of war two years ago.
On Tuesday, Trump once again called Kim “Rocket Man” and said the United States reserved the right to use military force against North Korea. Pyongyang said any repeat of such language would represent “the relapse of the dotage of a dotard.”
In spite of Trump’s reprise of the Rocket Man meme, he still expressed hope that Kim Jong Un would denuclearize. On Friday the U.S. ambassador to the United Nations said the United States had not yet decided whether to have a U.N. Security Council meeting to discuss North Korean human rights abuses that has angered Pyongyang.
On Friday, South Korea said Trump and South Korean President Moon Jae-in held a half-hour phone discussion on ways to maintain diplomacy with North Korea.
It said the two leaders agreed that the situation has become “severe” and that “dialogue momentum should be maintained to achieve prompt results from denuclearization negotiations.”
Trump thanks Iran for releasing American grad student: ‘We can make deal’
U.S. President Donald Trump hosts a roundtable discussion with small business owners and members of his administration in the Roosevelt Room at the White House December 06, 2019 in Washington, DC.
Chip Somodevilla | Getty Images
President Donald Trump on Saturday thanked Iran for releasing an American graduate student who had been imprisoned in Tehran for over three years on charges of espionage in exchange for a prisoner held in the U.S.
“Taken during the Obama Administration (despite $150 Billion gift), returned during the Trump Administration,” the president wrote on Twitter. “Thank you to Iran on a very fair negotiation. See, we can make a deal together!”
Xiyue Wang, 38, was a Princeton University doctoral student doing research in Iran when he was arrested there in August 2016 and sentenced to 10 years in prison over suspicion of being a spy.
U.S. officials have repeatedly denied that Wang, who was held in Evin Prison on two counts of espionage, was a spy.
Wang was released in Switzerland in exchange for Iranian citizen Massoud Soleimani, who was being held in an Atlanta jail over charges of violating American trade sanctions against Iran. Soleimani was expected to be released as early as January under a plea agreement.
Wang was among at least four other Americans being held in Iran.
The swap comes amid growing tensions between Iran and the U.S. and massive protests in Iran. Trump has placed significant economic sanctions on Iran and withdrew from the Obama-era Iran nuclear deal.
The protests erupted across Iran in November in response to a 50% increase in gas prices. U.S. officials believe the demonstrations have left as many as 1,000 people dead and 7,000 imprisoned, drawing widespread global criticism.
Secretary of State Mike Pompeo said Saturday that “The United States will not rest until we bring every American detained in Iran and around the world back home to their loved ones.”
The White House confirmed the trade on Saturday with a statement from Trump, and Iran’s foreign minister, Mohammad Javad Zarif, also confirmed the deal on twitter.
Managing China is NATO’s biggest challenge yet
China’s President Xi Jinping inspects People’s Liberation Army soldiers at a barracks in Hong Kong on June 30, 2017.
Dale De La Rey | AFP | Getty Images
China has emerged as the most formidable challenge that has ever faced NATO. That is true as well for the North American and European economies upon which NATO rests, which account for roughly half of global GDP.
Most media focused on the theatrics of this week’s 70th anniversary summit of NATO’s now-29 members. The biggest news – though woefully underreported – was that NATO, history’s most enduring and successful alliance, for the first-time defined China as a strategic challenge.
That news was drowned out by French leader Emmanuel Macron, who came into town having declared NATO brain dead; by Turkish leader Recep Tayyip Erdoğan, who responded that it instead was the French leader’s brain that was lifeless; by Canadian leader Justin Trudeau, who was caught mocking President Trump during allied cocktail hour; and by President Trump, who shrugged in response that the Canadian was two-faced.
As entertaining as all that was, more significant was that NATO allies have belatedly focused on the most significant challenge to world democracies and their market-driven economies in our new era of major power competition. However, although the closing NATO summit statement required unanimity, even more revealing is the ambiguity of its language, reflecting disagreement over whether Beijing is more of an economic opportunity than fundamental challenge.
“We recognize that China’s growing influence and international policies present both opportunities and challenges that we need to address together as an alliance,” it said.
That’s soft stuff considering that this authoritarian, state capitalist country has already become a global center of gravity – the world’s largest by population, ranking second only to the United States in military spending and, depending on what measure you like, is already or will soon be the largest economy on Earth.
The language was also muted compared to new outrage and legislative action in the United States and elsewhere regarding the reported repression of China’s Uighur Muslim minority, following weeks of Hong Kong protests and local elections supporting their cause, and in the face of continued concerns regarding Huawei’s 5G telecom dominance.
One also didn’t have to look far in the news this week to see new evidence of China’s growing partnerships with Russia, NATO’s primary focus for many years, ranging from a new 1,800 mile-long gas pipeline connecting both countries, to Huawei’s expanded relations with at least eight top Russian universities and research institutes.
Writing for Defense One, the Atlantic Council’s Barry Pavel and Ian Brzezinski have usefully called upon NATO to create a NATO-China Council that would collectively engage China on areas of concern. It would be a structural mechanism for dialogue with Russia to raise concerns, avoid misunderstandings and, where possible, foster cooperation.
The list of matters it would deal with is already a lengthy one, write the authors: Huawei’s targeting of European and North American digital infrastructure; increasing ownership of major European seaports critical to NATO; joint exercises with the Russian military, including in the Nordic-Baltic region; and cyber espionage and intellectual property theft.
A London financier friend, who has enough business in China to remain anonymous, lays out the case for why democracies around the world need to get their act together soon to address [Beijing’s] still-underestimated challenge.
Over time, he argues, China will have the largest human, economic and technological resources of any single country.
“The government has more successfully fostered economic development in a strategic fashion than any other communist or totalitarian regime in history,” he says, “successfully managing the tension (so far) between central control and harnessing the power of capitalist and market-based incentives and structures. Rising per capita incomes and the power of compounding means it will become the largest economy on the planet. Period.”
Nothing could be more confounding for those who thought history had determined that democratic rule was the flavor of the future. Unlike previous communist and authoritarian states, China has combined political control with innovation and development resulting from decentralized markets. In startling manner, China has managed to become a technological leader as well, and its closed system is feeding its advancement using big data and Artificial Intelligence.
“China has been smart about building strength without projecting strength,” says my London financier friend. “Many of its totalitarian predecessors lacked that discipline. And it will likely continue. It can further its rise until the discipline is no longer required.”
At that point, he reckons it will all become about one thing: what is China’s intent and how will it use its power. On this point, it would be unlikely to foster freedom of speech, dissent and discourse, rule of law, or democratic elections and decision making – everything NATO was created to defend.
So, it then comes down to degrees and modes of conflict or competition, which is what a concerted Western strategy would be designed to discuss and steer.
If you play the world forward, the resources still available to the US and its allies are formidable. They include the global financial system and the world’s reserve currency, which is critical to maintain. The U.S. also has the world’s most advanced innovation engine, though that’s no longer secure.
The NATO summit was also a good reminder of the value in pooled resources, not just for military purposes but perhaps more importantly to promote economic strength. However, at a time when unity of purpose is most required, new trade skirmishes broke out last week with Brazil, Argentina and with France.
History may still force transatlantic allies together to better manage China’s rise collectively. During the last world leadership transition, common Western purpose was less necessary because the US was displacing the United Kingdom, and both had similar value systems. As China rises, common purpose among Western allies will be more crucial.
Hong Kong protests have been a useful reminder that human desire for freedom is universal. Pluralism and democracy have proven to be the most resilient systems over time. Yet even optimists have got to worry about the costs of mismanaging this period of history.
It’s a good thing that NATO called out the challenge this week. Now alliance leaders should replace mocking and name calling with strategic planning and purpose.
Frederick Kempe is a best-selling author, prize-winning journalist and president & CEO of the Atlantic Council, one of the United States’ most influential think tanks on global affairs. He worked at The Wall Street Journal for more than 25 years as a foreign correspondent, assistant managing editor and as the longest-serving editor of the paper’s European edition. His latest book – “Berlin 1961: Kennedy, Khrushchev, and the Most Dangerous Place on Earth” – was a New York Times best-seller and has been published in more than a dozen languages. Follow him on Twitter @FredKempe and subscribe here to Inflection Points, his look each Saturday at the past week’s top stories and trends.
For more insight from CNBC contributors, follow @CNBCopinion on Twitter.
Politics1 week ago
Trump touts Florida Gov. DeSantis's ripped physique
Politics5 days ago
Labour election MAP: The abandoned northern heartlands where Corbyn is losing votes
Latest News4 days ago
Australia: Body found in search for final group member missing in outback | World News
Politics1 week ago
Pardoned Thanksgiving turkeys have ‘already received subpoenas’
Politics6 days ago
Immigration is a dicey issue for 2020 Democrats as they seek Latino vote
Latest News6 days ago
US weather: At least six die as winter storms sweep across country | US News
Politics3 days ago
Inside Trump’s gloomy London swing
Politics3 days ago
Buttigieg slams disruption of black supporters’ rally that turned into chaos