Have you ever seen the reaction of a person from a third world country going to a US supermarket.  Truly it is like the 7^th wonder of the world for them to behold the bounty that we take for granted every day.

Yet the news of more and more meat processing plant closures because of the Coronavirus continues to mount. This is setting up for a period of serious meat shortages in the US…the likes of which we have never seen. This also sets up a unique group of stocks to actually benefit as this drama unfolds.

No doubt Beyond Meat (BYND) is the first name that comes to mind. But let me also shares with you 3 others to consider as attractive portfolio alternatives at this time: Kellog (K), Simply Good Foods (SMPL) and Yum! Brands (YUM).

Read on below for more details…

Beyond Meat (BYND)

Like I said above. This BYND is the first stock that will come to mind a beneficiary of this evolving trend. Even die hard meat eaters, like me, who absolutely refused to try their offering before may be swayed over if there is no serious alternative. And the more who try BYND products…the more may stick with it for a long haul. So this may be a serious catalyst for their business over the long haul.

Realize that most food companies have held up quite well under the strain of the recent bear market. That explains why BYND is actually up 21% this year. However, some notable analysts still see plenty more upside with a smattering of target prices from $100 to $130 still levied on BYND shares. Often with hot IPOs like BYND you should wait for the initial premium to wear off. That certainly has after shares soared well over $200 in the Summer of 2019. As it turns out the summer of 2020 may be the time to climb on board for the long ride higher.

Yum! Brands (YUM)

If you were to predict KFC and Taco Bell would become power players in the vegetarian and vegan market, most people would not believe you.  Though these companies certainly sell their fair share of meat, they are prudently pivoting to boost their appeal to those who favor meatless offerings.

Customers lined up as far as the eye could see during KFC’s initial test run of vegan fried chicken in Atlanta.  The scrumptious fake meat is now expanding to 70 locations.  This is fantastic news for KFC’s parent company, YUM.  Furthermore, Taco Bell is expanding its vegetarian offerings in hopes of capturing more of the coveted millennial and Generation Z market share, helping YUM’s cause all the more.

If you have any doubt as to whether millennials’ tastes dictate the direction of the market, look no further than the fact that they are the largest age cohort in the United States.  YUM’s forward-thinking will help the company’s restaurants maintain their current customer base while winning favor with those who prefer meat alternatives, ultimately helping the stock move beyond TipRanks’ average analyst price target of $96.81.

Kellogg (K)

The vegan craze has reached a mainstream saturation point as evidenced by the fact that Kellogg has hopped on the no-meat bandwagon.  Though most people assume K strictly sells cereal, the little-known truth is K also sells the popular MorningStar Farms vegan product line.  In fact, K acquired this vegan food company way back in 1999.

While plenty of vegans complain BYND burgers are bland, most are quick to testify K’s MorningStar Farms faux hamburgers, sausage and chicken taste pretty good.  All in all, 90 million pounds of MorningStar Farms products are sold each year, equating to $450 million in yearly revenue – double Beyond Meat’s yearly sales figures.

The fact that Kellog has soared back after dropping from $68 to $53 in mere days during the coronavirus sell-off is a testament to investors’ confidence in this food company.  With all these events taking place K has a real chance to reach and maybe even exceed TipRanks’ average analyst price target of $68 in the weeks ahead.

The Simply Good Foods Company (SMPL)

Plant-based protein is all the rage amongst millennials, Generation Z and health-focused adults.  SMPL makes these in-demand food products under a variety of in-demand labels.  Note that SMPLY is the firm formerly known as Atkins.

SMPL took it hard at the onset of the bear market. Now it is all the way down at $18.35. This makes it a heck of a value proposition when the average analyst price target for SMPLY is a whopping $28, representing a nearly 60% upside.

The thing I want to be clear about with SMPL is that it is more than you stable food company. This is very much a growth company with 20-25% per year growth expected by the analysts. Add the growth and value together, with the emerging story for meat shortage and you understand the appeal of SMPL shares at this time.

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BYND shares closed at $91.53 on Friday, down $-7.46 (-7.54%). Year-to-date, BYND has gained 21.07%, versus a -11.62% rise in the benchmark S&P 500 index during the same period.

About the Author: Steve Reitmeister

Steve is better known to the StockNews audience as “Reity”. Not only is he the CEO of the firm, but he also shares his 40 years of investment experience in the Reitmeister Total Return portfolio. Learn more about Reity’s background, along with links to his most recent articles and stock picks. More...

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