10 Best Alternative Meat Stocks to Invest In

In this article, we discuss the 10 best alternative meat stocks to invest in.

The alternative meat industry, encompassing both plant-based and cultivated meat products, is poised for significant growth as it addresses global challenges related to health, sustainability, and animal welfare. This burgeoning sector has captured the attention of consumers, investors, and policymakers alike, with a future outlook that is both promising and complex. To understand where the industry is headed, it is essential to explore current trends, market projections, and expert opinions. The alternative meat market has seen rapid expansion over the past decade, with global sales of plant-based meat alone surpassing $7 billion in 2020. According to a report by Allied Market Research, the plant-based meat market is expected to reach $35.5 billion by 2027, growing at a compound annual growth rate of 15.8% from 2021 to 2027. This growth is fueled by increasing consumer awareness of the environmental impact of traditional meat production, as well as concerns about health and animal welfare.

Cultivated meat, though still in the early stages of commercialization, is also projected to become a major player in the alternative protein market. The Good Food Institute (GFI) estimates that the cultivated meat industry could reach $25 billion by 2030, driven by advancements in cell-culturing technologies and increasing consumer acceptance.  One of the key drivers of this growth is the potential to significantly reduce the environmental footprint of meat production. Traditional livestock farming is a major contributor to greenhouse gas emissions, land degradation, and water consumption. The Food and Agriculture Organization estimates that the livestock sector accounts for 14.5% of global greenhouse gas emissions, with beef production being the most intensive. In contrast, plant-based meats have a much lower environmental impact. A study published in the journal Science found that producing plant-based meat alternatives generates up to 90% fewer greenhouse gas emissions, uses 93% less land, and consumes 46% less energy compared to conventional beef production. Cultivated meat also holds promise for reducing the environmental impact, though its full potential will depend on the scalability of production and improvements in energy efficiency.

Health concerns are another significant factor driving the adoption of alternative meats. Diets high in red and processed meats have been linked to various health issues, including heart disease, cancer, and obesity. In contrast, plant-based meats typically offer lower levels of saturated fat and cholesterol, making them a healthier alternative for consumers looking to reduce their meat intake without sacrificing taste and texture. Moreover, advancements in food technology are enabling companies to fortify alternative meats with additional nutrients, such as vitamins, minerals, and omega-3 fatty acids, to further enhance their health benefits. However, some critics argue that many plant-based meats are still highly processed and contain high levels of sodium, which could pose health risks if consumed in large quantities.

Despite the positive trends, the alternative meat industry faces several challenges that could impact its future growth. Consumer acceptance remains a significant hurdle, particularly for cultivated meat. While plant-based meats have gained widespread popularity, with brands like Beyond Meat and Impossible Foods becoming household names, cultivated meat is still met with skepticism by some consumers due to its novel production process and perceived unnaturalness. A survey conducted by GFI in 2021 found that while 40% of consumers in the United States were willing to try cultivated meat, only 30% were willing to make it a regular part of their diet. To overcome this challenge, companies in the cultivated meat space are focusing on transparency, education, and marketing efforts to build consumer trust and familiarity with their products.

Price parity with conventional meat is another critical factor that will influence consumer acceptance. Currently, alternative meats are often more expensive than traditional meats, which can be a barrier to widespread adoption. However, as production scales and technologies improve, experts predict that the cost of alternative meats will decrease, making them more accessible to a broader audience. A report by Boston Consulting Group suggests that by 2035, alternative proteins could reach price parity with conventional meat, further accelerating their adoption. Investment in the alternative meat industry has skyrocketed in recent years, reflecting growing confidence in its long-term potential. According to GFI, investment in alternative proteins reached a record $3.1 billion in 2020, with significant contributions from venture capital firms, corporate investors, and even traditional meat companies like Tyson Foods and Cargill.

This influx of capital is driving innovation across the industry, with companies exploring new sources of plant-based proteins, such as algae, fungi, and insects, as well as advancements in cell-culturing techniques for cultivated meat. The development of hybrid products that combine plant-based and cultivated ingredients is also an emerging trend, offering a middle ground between the two approaches and appealing to a wider range of consumers. The regulatory environment will play a crucial role in shaping the future of the alternative meat industry. In 2020, Singapore became the first country to approve the sale of cultivated meat, a landmark decision that could pave the way for other countries to follow suit. In the United States, the Food and Drug Administration and the US Department of Agriculture are working together to establish a regulatory framework for cultivated meat, which is expected to accelerate the commercialization of these products.

However, regulatory approval is just one piece of the puzzle. Labeling requirements, food safety standards, and intellectual property protections will also need to be addressed as the industry grows. Clear and consistent labeling will be particularly important to ensure that consumers can make informed choices about the products they purchase. The future of the alternative meat industry is bright, with strong growth prospects driven by consumer demand for sustainable, healthy, and ethical food options. However, the industry must navigate several challenges, including consumer acceptance, pricing, and regulatory hurdles, to fully realize its potential. As innovation continues to drive the development of new products and production methods, and as investment flows into the sector, the alternative meat industry is well-positioned to play a key role in the global food system of the future.

10 Best Alternative Meat Stocks to Invest In

Chefs in a fast-food kitchen preparing burgers and fries.

Our Methodology

For this article, we selected food stocks that offer lab-grown or alternative meat products by sifting through ETFs and online rankings. We selected the 10 stocks that were the most popular among hedge funds, as of Q2 2024. The hedge fund data was sourced from Insider Monkey’s database.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).

Best Alternative Meat Stocks to Invest In

10. Steakholder Foods Ltd. (NASDAQ:STKH)

Number of Hedge Fund Holders: 1 

Steakholder Foods Ltd. (NASDAQ:STKH) is a deep-tech food company that engages in the development of cultivated meat technologies to manufacture cultivated meat without animal slaughter in Israel. The company is different from plant-based meat firms since it specializes in cultivated meat, which is grown directly from animal cells. Some of the products include cultivated beef, chicken, and pork, as well as 3D bioprinted meat. The 3D bioprinted steak, part of the 3D bioprinted suite of products, uses a combination of cultured cells and 3D printing technology to create a steak with the desired marbling, texture, and taste. The process allows for precise control over the structure, offering the possibility of customizing fat content and other characteristics.

Steakholder Foods Ltd. (NASDAQ:STKH) has also shown interest in developing hybrid products that combine cultured meat with plant-based ingredients. These products aim to offer a middle ground between traditional meat and fully plant-based options, providing a more sustainable and potentially more affordable alternative.

9. Beyond Meat, Inc. (NASDAQ:BYND)

Number of Hedge Fund Holders: 10 

Beyond Meat, Inc, (NASDAQ:BYND) manufactures, markets, and sells plant-based meat products in the United States and internationally. The company is one of the biggest alternative meat providers in the world. Many large retail chains across the US carry the products from this brand that is sometimes termed the iPhone of the alternative meat world. The alternative meat portfolio of the firm includes burgers, sausages, meatball, jerky, beef, and chicken products, among others. The company also sells lab-grown meat products. The gross margins for the company have been improving in recent months because of price hikes and effective cost-cutting measures.

Wall Street continues to view Beyond Meat, Inc. (NASDAQ:BYND) with cautious optimism. BMO Capital recently lowered the price target on the shares to $6 from $9 and kept a Market Perform rating, underlining that the Q2 revenue and gross margins of the firm had topped expectations but EBITDA was $1 million below on higher operating expenses. The advisory added that the firm was making progress right-sizing cost structure and slowing cash burn.

8. Hormel Foods Corporation (NYSE:HRL)

Number of Hedge Fund Holders: 31

Hormel Foods Corporation (NYSE:HRL) develops, processes, and distributes various meat, nuts, and food products to retail, foodservice, deli, and commercial customers internationally. The firm has a large alternative meat business. Some of the famous brands in this portfolio include Happy Little Plants, Applegate Naturals, Lloyd’s Plant-Based Products, and Herbivorous Butcher. The firm posted earnings for the second quarter of 2024 back in May, reporting earnings per share of $0.038, beating market estimates by $0.02. The revenue over the period was close to $2.9 billion.

The strength of the retail business of Hormel Foods Corporation (NYSE:HRL) has forced Wall Street analysts to view the firm in a bullish manner. Citi analyst Thomas Palmer recently upgraded the stock to Buy from Neutral with a price target of $37, up from $33. In an investor note, the analyst detailed that there was slight upside potential to fiscal Q3 and fiscal 2024 earnings estimates for the firm and further upside in fiscal years 2025 and 2026, as underlying retail sales trends seemed to be improving, the input cost environment seemed benign, and production declines by the turkey industry would soon send prices higher.

7. Tyson Foods, Inc. (NYSE:TSN)

Number of Hedge Fund Holders: 27   

Tyson Foods, Inc. (NYSE:TSN) operates as a food company worldwide. Tyson Foods has expanded into the alternative meat market over the past few years, offering various plant-based and blended products. Some of these include plant-based nuggets made primarily from pea protein, plant-based patties, and blended products that combine plant-based ingredients with traditional meat, aiming to reduce the overall meat content. The firm has also shown interest in the cultivated meat sector by investing in companies like Future Meat Technologies and Memphis Meats, which are at the forefront of developing lab-grown meat.

Tyson Foods, Inc. (NYSE:TSN) has attracted the attention of Wall Street investors with investments in lab-grown meat. Barclays recently raised the price target on the shares to $72 from $69 and kept an Overweight rating, highlighting that the firm reported solid results for the quarter as continued improvements in Chicken and Pork offset continued weakness in Beef and expected declines in Prepared Foods.

6. Performance Food Group Company (NYSE:PFGC)

Number of Hedge Fund Holders: 42 

Performance Food Group Company (NYSE:PFGC) markets and distributes food and food-related products in the United States. The company has a healthy alternative meat portfolio, with popular plant-based brands such as Beyond Meat, Impossible Foods, and Gardein featuring in stores across the US. These products are widely used in foodservice operations, including restaurants and institutional dining, to offer customers meat-free options that closely mimic the taste and texture of traditional meat.

Performance Food Group Company (NYSE:PFGC) recently announced the purchase of Cheney Brothers, a Florida-based food distributor, for $2.1 billion. The deal will help expand the geographic reach of the firm, as the distribution footprint of the latter in key geographies enhances the existing distribution platform and overall density of the former.

5. Sysco Corporation (NYSE:SYY)

Number of Hedge Fund Holders: 37 

Sysco Corporation (NYSE:SYY) distributes food and related products. The company offers a range of alternative meat products under the Sysco Simply brand, catering to the growing demand for plant-based options. Some of these include meatless burger patties made from non-GMO soy, plant-based ground bulk, and plant-based meatballs. The firm is one of the most stable food stocks in the US. It has a dividend payout record stretching back more than five decades in a sector where the median value for this is just fourteen years. For the last eight years, this payout has registered consistent growth, compared to the two year growth average for the rest of the industry.

Sysco Corporation (NYSE:SYY) recently declared a quarterly dividend of $0.51 per share, in line with previous. The forward yield was 2.69%. In earnings for the fourth quarter of this fiscal year, the firm beat market expectations on earnings per share and revenue by $0.01 and $50 million respectively. Following the results, Barclays raised the price target on the shares to $88 from $85 and maintained an Overweight rating.

4. The Kraft Heinz Company (NASDAQ:KHC)

Number of Hedge Fund Holders: 43      

The Kraft Heinz Company (NASDAQ:KHC) manufactures and markets food and beverage products in the United States, Canada, the United Kingdom, and internationally. The company has made a name for itself in the alternative meats business through the BOCA brand, which is well-known in the plant-based food sector. Some of the products include veggie burgers made from soy protein, chicken patties made from soy, and vegan burgers designed to mimic the taste of beef. In addition to these products, Kraft Heinz has also been expanding into other plant-based and alternative protein markets, including partnerships and new product developments under the Heinz brand, such as plant-based hot dogs.

The Kraft Heinz Company (NASDAQ:KHC) is viewed cautiously on Wall Street. Barclays recently raised the price target on the stock to $36 from $34 and kept an Equal Weight rating, noting in an investor note that like many other packaged food players, Kraft Heinz was weaving its way through a balancing act between maintaining long-term brand profitability and selectively increasing trade spend.

3. The Kroger Co. (NYSE:KR)

Number of Hedge Fund Holders: 46   

The Kroger Co. (NYSE:KR) operates as a beef retailer in the United States. It sells alternative meat products under a private label, as well as from other brands like Beyond Meat, Impossible Food, and JUST Egg. The plant-based meat products include chicken patties and grounds, meatless burgers, deli slices with flavors like ham and turkey, as well as sausages. The company places plant-based meat products alongside traditional meat options in stores, a practice that has helped it post better sales numbers than competitors in this domain. This translates to better earnings. In June, the company raised the quarterly dividend by 10%.

Wall Street analysts are bullish on The Kroger Co. (NYSE:KR) even as a proposed merger with rival Albertsons goes to court. For example, Argus recently raised the price target on the stock to $72 from $70 and kept a Buy rating, noting that the prospects for the food firm were bolstered by affordable private brands, strong customer analytics that allow it to deliver personalized discounts, and a growing emphasis on fresh foods, as well as by the convenience of online ordering and curbside pick-up at stores.

2. US Foods Holding Corp. (NYSE:USFD)

Number of Hedge Fund Holders: 52 

US Foods Holding Corp. (NYSE:USFD) engages in marketing, sale, and distribution of fresh, frozen, and dry food and non-food products to foodservice customers in the United States. It is heavily invested in the alternative meats business. Besides Beyond Meat and Impossible Food products, the firm also sells vegetable-based meat alternatives, including mushroom-based products, tofu and tempeh, and plant-based fish and shrimp. The popularity of these products can be estimated by viewing the rapidly expanding meat substitute market, driven by factors like the increasing vegan population and consumer interest in sustainable eating. This market is expected to grow from around $6.5 billion in 2023 to more than $11.3 billion by 2028.

US Foods Holding Corp. (NYSE:USFD) is one of the most prominent alternative meat stocks on Wall Street. Barclays recently raised the price target on the stock to $66 from $64 and kept an Overweight rating. In an investor note, the advisory noted that the Q2 EBITDA for the food firm was better than expected, which mitigated a modest sales shortfall pressured by the broader macro, which continued in July.

1. Albertsons Companies, Inc. (NYSE:ACI)

Number of Hedge Fund Holders: 59

Albertsons Companies, Inc. (NYSE:ACI) engages in the operation of food and drug stores in the United States. The firm sells many different types of alternative meat products. These products typically include plant-based meat alternatives like those from popular brands such as Beyond Meat and Impossible Foods. These are available in various forms, including burgers, sausages, and ground meat, often found in the frozen or refrigerated sections of their grocery stores. The company has also been increasing the range of plant-based products in response to growing consumer demand for healthier and more sustainable food options. However, these products are only available in select locations due to varying laws on alternative meat.

Albertsons Companies, Inc. (NYSE:ACI) is presently undergoing a merger with rival Kroger. This deal, worth more than $25 billion, has invited scrutiny from trade authorities in the US, forcing all parties involved into a court battle. This battle has negatively impacted the share prices of the stock, but the fundamentals of the company remain as valuable and attractive as ever. Wall Street analysts, like Daniel Biolsi of Hedgeye, expect the deal to be approved.

While we acknowledge the potential of Albertsons Companies, Inc. (NYSE:ACI) as an investment, our conviction lies in the belief that some stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a stock that is more promising than Albertsons Companies in this regard, check out our report about the cheapest AI stock.

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