Markets
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Luke Kawa

Beyond Meat surges on heavy volume as retail traders position for a squeeze in the embattled plant-based meat company

Shares of Beyond Meat are soaring in early trading on Monday, with retail traders hoping for a turnaround — or more realistically, a powerful short squeeze — as the embattled plant-based meat producer scrambles to raise cash to protect its viability.

As of 7:15 a.m. ET, more money had changed hands trading the faux meat firm in the premarket than the likes of Apple, Microsoft, or Palantir.

Bloomberg Most Traded Stocks in US as of 7:15 a.m. ET
Source: Bloomberg

The stock cratered to an all-time low of $0.50 last Thursday after management completed a deal with nearly 97% of the holders of more than $1 billion in senior convertible notes due in 2027 (with a coupon of zero) to exchange those for $196 million in second lien notes due in 2030 (with a coupon of 7%) and more than 316 million shares, a massive dilution of existing shareholders that raised the company’s share count by more than 300%. Those noteholders are now far and away the biggest holders of the company’s equity.

A former Reddit user (who since appears to have been banned from the platform) with the handle capybaraSTOCKS appears to be at the genesis of this newfound wave of optimism surrounding the stock. The user has purportedly since moved to YouTube and says they own 4% of the company. They posted a video on Sunday explaining their thesis, including progress on the company reducing its debt load, its brand value, and the potential for a short squeeze.

“High community interest, social media buzz, and most importantly a near 500 million shares traded volume on Friday” suggest “Beyond is now entering meme stock territory,” per the video.

The stock was among the most highly shorted US companies heading into the month, with over half its shares sold short, per Bloomberg data. That number likely came down meaningfully in the short term thanks to the issuance of over 316 million shares as part of the aforementioned debt-for-equity-and-other-debt swap last week, which saw those who took the company up on its plans temporarily barred from transferring beneficial ownership or selling a large portion of the new shares.

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Helena Cheng

Lululemon’s stretch getting tested: Stock plunges after after outlook is cut

Lululemon shares are down double digits in premarket trading after the company cut its full-year sales and profit outlook, overshadowing a Q1 beat and raising fresh concerns about the brand’s turnaround efforts.

The company now expects fiscal 2026 revenue to be flat to down 1%, compared with its prior forecast for 2% to 4% growth. Guidance for full-year diluted earnings per share was dragged down to a range of $10.95 to $11.15, below the company’s previous guidance of $12.10 to $12.30 and well below Wall Street’s estimate of $13.26.

Key numbers for Q1:

  • EPS of $1.69 vs. the $1.68 expected.

  • Revenue of $2.47 billion vs. the $2.43 billion expected.

The modest top-line beat masked a widening divergence between Lululemon’s geographic markets. While international revenue rose 22% overall with a 30% increase in Mainland China, the bigger problem remains North America, where revenue fell 5%.

Interim co-CEO and CFO Meghan Frank acknowledged during the earnings call that recent product rollouts underperformed. A highly anticipated yoga campaign failed to generate its expected “halo effect” across broader product lines.

Profitability metrics took a major hit, with gross margins contracting by 410 basis points to 54.2% due to mounting tariff costs and promotional markdowns. Operating income consequently fell 37% year over year to $276.9 million.

“We experienced spikes of negative commentary in the media and on social channels with regard to our brand, which had an impact on traffic and overall top-line performance,” Frank said during the earnings call. “And second, not all of our product launches have met our expectations. While we have had several successful launches so far this year, we have seen others as we start Q2 not generate the anticipated guest response.”

Lululemon’s valuation has already been steadily compressing for years. While it was once one of retail’s richly valued stocks, investors have been questioning whether the company can return to the double-digit growth era.

The results also arrive during a leadership transition. Lululemon announced back in April that former Nike executive Heidi O’Neill is set to take over as CEO in September, with investors looking to her to revive growth in North America and restore the brand’s growth.

As Lululemon faces both macroeconomic pressure and brand-specific challenges, its stock has dropped around 40% year to date.

markets
Paige Oamek

US job growth skyrocketed in May, blasting past expectations

The US economy added 172,000 jobs in the month of May, the Bureau of Labor Statistics reported Friday, sending 10-year Treasury yields higher.

The strong May job market surprised economists. Experts had predicted only 85,000 new jobs — just half the reported number. The unemployment rate held steady at 4.3%, as expected.

The job growth story is a hopeful spot for the economy as consumers continue to feel inflationary pressure from the Iran war.

Job gains were buoyed by the leisure and hospitality sector, which added 70,000 jobs, as well as local government, healthcare, and education.

Both the March and April jobs reports were revised upward, making them collectively 93,000 higher than previously reported.

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