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There are some weeks when the stock market behaves like a sensible adult. Other weeks, it behaves like it’s been left unsupervised with an energy drink on tap. Beyond Meat just gave us one of those: its shares shot up more than 600% in three days before promptly collapsing back down again. No miracle turnaround, no celebrity endorsement, no sudden boom in vegan barbecues – just full-blown market mania.
So, what on earth happened – and why does it keep happening?
Beyond Meat has had a rough few years. Sales are down, costs are high and the company’s glow from its 2019 IPO days has long faded. That made it a favourite for short sellers – investors who borrow shares, sell them, and hope to buy them back later for less.
At one point, roughly 80% of Beyond Meat’s freely traded shares were shorted. That’s unusually high, and it turns a share price into a pressure cooker. If the price begins to rise, short sellers start scrambling to buy back shares to avoid losses. And that extra demand pushes the price even higher, forcing others to follow. It’s a chain reaction known as a short squeeze – a bit like lighting the barbeque and discovering you’ve been heavy handed with the lighter fluid.
The spark, in this case, was…rather mundane. Beyond Meat announced a new six-pack of burgers and a bit more shelf space in Walmart. Hardly a game changer. But then it was added to a “Meme Stock” ETF, the Roundhill Meme ETF – a fund that tracks the most mentioned shares on social media.
That’s all it took. Retail traders spotted it, algorithms joined in, and the buying frenzy began.
If this rings a bell, it should. Back in 2021, shares in GameStop and AMC – two struggling US companies – became the centre of an online trading frenzy. Small investors on Reddit banded together to buy the heavily shorted stocks, driving prices to absurd levels and forcing hedge funds to retreat.
Beyond Meat’s week followed the same pattern: high short interest, online hype, and a crowd eager to prove a point. The result was a brief but spectacular price surge, followed by an equally swift return to normality.
Markets like to think of themselves as temples of rational thought. But in practice, they’re more like a group chat with a trading licence – logical one minute, instinctive the next. Add in a few quirks in how trading actually works, and these flare-ups are almost inevitable.
Put that together and you have the perfect setup for a meme-stock moment – especially in smaller, well-known companies like Beyond Meat, where stories can move faster than sense.
If you’d like a quick refresher on short selling (and why so many hedge funds get caught out), we covered it all in our earlier Insight: Short Selling Explained.
By the end of the week, Beyond Meat’s shares were already sliding back to where they started. Nothing fundamental had changed: demand was still sluggish, margins were thin, and the company continues to lose money. The brief surge was all noise and momentum – a reminder that in the short term, markets can behave like popularity contests, but eventually the numbers have the final word.
The episode also says something about modern markets themselves. Technology has made trading instant, options have made it riskier, and social media has made it louder. Together, they create bursts of excitement that burn brightly, then fade fast.
Beyond Meat’s wild week wasn’t really about burgers; it was about behaviour. Markets are still driven by stories as much as numbers, and when a good one catches on, logic tends to take a back seat. For a few days, traders were buying belief, not business fundamentals.
The lesson isn’t that markets are broken – just that they’re human. Hype fades, numbers matter, but sooner or later, reality has a habit of catching up.
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