Beyond Meat shares fall after McDonald's ends Canadian trial of meatless burger

Key Points
  • McDonald's Canada stopped testing a meat-free burger made with a Beyond Meat patty on April 6.
  • The chain has no plans to bring back the menu item at this point.
  • McDonald's has yet to test a vegan burger in the U.S.

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Beyond Meat gets burned

Shares of Beyond Meat fell 7% in morning trading after the CBC reported that McDonald's stopped testing a burger made with its patties in Canada.

In a tweet to a consumer asking about the burger, McDonald's Canada said that the test ended April 6. The chain has no plans to bring back the item at this time. 

McDonald's stock was trading down 1%.

"We can only comment generally and share that we were pleased with the test," a Beyond spokesperson said in a statement to CNBC.

Beyond Meat CEO Ethan Brown told analysts in early May that the test concluded "for no negative reason at all."

"I mean, we feel very good about our relationship with McDonald's. And what's going to be happening both, there and potentially elsewhere," Brown said. "So, by the nature of it being a test, it had a beginning and an end."

In September, McDonald's joined the push for more meat alternatives in North America when it started testing the meat-free P.L.T. burger in southwestern Ontario. The test expanded to another 24 locations in January for a 12-week test.

McDonald's said in a statement that there has been no change to its relationship with Beyond Meat.

"We're evaluating learnings from our recent test to inform future menu options. As we look ahead, we will plan to bring plant-based options to the menu at the right time for customers in individual markets," the company said.

Other international McDonald's markets have found more success with meatless burgers. Restaurants in Germany, for example, have added veggie burgers made by Nestle to their menus.

In the United States, McDonald's has yet to test a vegan burger. The coronavirus pandemic led the chain to streamline its menus temporarily and to push back product launches, including a new chicken sandwich.

Rival Burger King has been serving an Impossible Whopper nationwide for nearly a year. The Restaurant Brands International chain recently announced that it will be adding a meat-free breakfast sandwich to national menus.

Beyond's stock, which has a market value of $8.9 billion, has risen nearly 84% so far this year. Shares of McDonald's, which has a market value of $140 billion, has fallen 8% in 2020. 

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