Beyond Meat, meet Big Mac.
One chart shows an intriguing connection building between the stocks of fake meat maker Beyond Meat and fast-food giant McDonald's, said Todd Gordon, technical analyst and founder of TradingAnalysis.com.
Between that trend and Jefferies analysts saying there's a "high probability" McDonald's will add plant-based protein to its menus, it appears some traders are betting on Beyond in the hopes of seeing a partnership between the two food companies — though not everybody is convinced it'll happen.
"I think there's a perpetual bid in Beyond for the possible outlook of a partnership with McDonald's," Gordon said Thursday on CNBC's "Trading Nation," referencing a chart of the two stocks.
"What you'll see here is there's a little better correlation than what you might expect," Gordon said. "We saw McDonald's kind of sell off. Beyond had already sold off. Little bit of divergence, but they've realigned."
Gordon acknowledged that some market watchers might think he's reaching, but asked those skeptics to consider the correlation between the S&P 500 and these two stocks.
"Throw the S&P on top of these [two], and you'll see there's actually a better correlation of McDonald's and Beyond than there is with the S&P," he said.
"Maybe [it's] restaurant stocks trading together. Maybe they're kind of playing off each other. Just something to watch," Gordon said.
Beyond Meat shares have rallied nearly 525% since the company's May 2 initial public offering. In that time, Beyond Meat has announced partnerships with Subway, Del Taco, KFC, Dunkin' Brands, and meal-kit makers HelloFresh and Blue Apron. McDonald's has been one of the most notable chains to avoid buying into the fake meat craze thus far.
On Thursday, Barclays initiated coverage of the stock with an "overweight rating," predicting about 19% upside. But much of the surge could be chalked up to hype, warns Mark Tepper, president and CEO of Strategic Wealth Partners.
"I think I'd rather go to Vegas right now and put my money on the Cleveland Browns winning the Super Bowl because, just like Beyond Meat, there was a ton of hype surrounding them in the preseason, but it's fizzled out quite a bit because there are holes that need to be fixed, just like with Beyond Meat," he said in the same "Trading Nation" interview.
Those "holes" make Beyond Meat's sky-high valuation — roughly 36 times sales, by Tepper's calculation — "absolutely ridiculous," the investment pro said.
"It's trading on hype. So, it could go higher, but it's a no-touch for us," Tepper said. "Health and wellness is a theme we want to play, but there's really no evidence that this is any healthier than real meat. So, I think what you're going to see happen here is a lot of people are going to give it a try, but I don't think they quit meat and begin eating this."
And, if that doesn't play out, that will likely spell trouble for Beyond's bullish streak and bring its valuation "back down to earth," he said.
"Just wait until a bigger competitor like maybe Tyson rolls out their fake meat product. They'll be able to produce it cheaper, they can offer it to consumers at a lower price, so why would the consumer stick with Beyond Meat?" Tepper said. "I know Barclays says there's 19% upside, but is the risk-reward worth it with how volatile this stock has been? I'd say 'no' because it could just as easily drop 50%, and that's not a good trade-off. So, this thing's not for us."
Beyond Meat and McDonald's stocks both rose by less than 1% early Friday. Neither company immediately responded to CNBC's request for comment.
