5 Top Vegan Stocks For a Sustainable Future

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There’s an unusual shift happening among American eating habits: More of us than ever before are open to the idea of eating less meat. A 2020 Gallup poll said that 23% of Americans cut back on their meat consumption over the past year.  

The top two reasons for doing so? Health and the environment. 

Of course, veganism entails far more than just cutting back on the occasional steak; you also have to cut out all animal-based products. But the point is that a large portion of the average population is starting to change their thinking about food from animals.

And, despite what you might think about the vegan lifestyle, you don’t have to make your clothes out of hemp or be a member of a drum circle to incorporate more plant-based foods into your diet. 

In fact, many fast-food chains in the United States—including KFC, Burger King, Pizza Hut, and more—have tested or added vegan options to their menus. 

So, why are these companies jumping on the vegan gravy train? For one, the vegan market is expanding rapidly and is expected to more than double in size from 2018 to 2026. 

And then there’s the sustainability angle that is drawing in both companies and individuals. Raising animals for meat consumption generates a lot of greenhouse gases and, generally speaking, vegan alternatives can be produced with less harm to the environment. 

For example, a study conducted by Quantis found that 1kg of plant-based meat made by Impossible Meat required 96% less land, contributed 89% less greenhouse gas emissions, and used 87% less water than 1kg of beef. 

For investors who care about environmental sustainability and want to tap into the fast-growing vegan market, you’re in luck. Below are three companies diving headfirst into the vegan lifestyle and two that are expanding their operations to add vegan options.

5 Vegan Stocks for a Sustainable Future 

These are the top 5 vegan stocks to invest in this year.

  1. Beyond Meat 
  2. Tattooed Chef 
  3. Oatly Group
  4. The Hain Celestial Group
  5. United Natural Foods 

Beyond Meat (Nasdaq: BYND)  

  • Beyond Meat, Inc. (NASDAQ:BYND)
  • Price: $66.26 (as of close Dec 1, 2021)
  • Market Cap: $4.196B

Beyond Meat may be one of the most well-known companies on this list. That’s because the company has expanded rapidly across the globe and its products can be found in more than 112,000 grocery stores and restaurants across the United States. 

Beyond Meat started with its plant-based burger but has since expanded to meatballs, sausage, and even “chicken.” 

The company is a major success story in the vegan market. Consider that in the second quarter of 2021, sales increased 32% compared to 2020 (which was a particularly bad year thanks to the pandemic). Comparing second-quarter 2021 sales to 2019 shows a more complete picture, in which revenue skyrocketed 122% over the two-year period. 

Beyond Meat went public in mid-2019, and despite the stock’s volatility, its share price has still gained 57% since its IPO, outpacing the S&P 500’s 49% gain over the same period. 

And when it comes to creating a more sustainable future for food production, Beyond Meat is putting up some very impressive numbers in that category as well.  

The company’s plant-based Beyond Burger generates 90% less greenhouse gas emissions, requires 46% less energy and has 93% less impact on land use than a ¼ pound of U.S. beef, according to a University of Michigan study. 

Tattooed Chef (Nasdaq: TTCF) 

  • Tattooed Chef, Inc. (NASDAQ:TTCF)
  • Price: $15.51 (as of close Dec 1, 2021)
  • Market Cap: $1.272B

Unlike some of its vegan counterparts, the Tattooed Chef isn’t focused on getting its products into restaurants. Instead, the company makes frozen, ready-to-cook vegan products, including cauliflower macaroni and cheese bowls, pizza crusts, acai bowls, and plant-based burgers.

The company says that it uses “sustainably sourced ingredients” and plants to grow and produce all of its own food. By controlling the entire food production process, from its farming locations in Italy and California, the company is in control of the entire system leading right up to when customers buy its products. 

Tattooed Chef is young, having started in 2018, and its shares have only been publicly listed for less than two years. The Tattooed Chef went public through a special purpose acquisition company (SPAC) merger in June 2020 and since then its share price has jumped nearly 50%. 

In the second quarter of 2021, the company said it acquired Foods of New Mexico, giving it additional non-frozen products and expanding the company’s food production capacity.  Additionally, the Tattooed Chef said that by the end of the third quarter its products will be in 12,000 retail stores, surpassing its previous goal of 10,000 locations. 

Like some other vegan stocks—and newly publicly traded companies—the Tattooed Chef’s share price has been pretty volatile since it went public. Potential investors may want to keep tabs on how the company’s recent expansion translates into additional sales and, hopefully, expands its bottom line. 

Oatly Group (Nasdaq: OTLY) 

  • Oatly Group AB (NASDAQ:OTLY)
  • Price: $8.4 (as of close Dec 1, 2021)
  • Market Cap: $4.971B

Oatly has been selling alternative milk since long before alternative milk was even a trend. The company got its start in the 1990s and says that it’s the “original and largest oat drink company.”

As its name suggests, the company sells oat-based milk alternative products, which include oat milk, ice cream, yogurt, and even cooking creams. The Swedish company has found worldwide acceptance in more than 60,000 stores across the globe. 

Oat milk is generally more environmentally friendly because it uses far less water to produce than cow milk. A liter of oat milk requires 48 liters of water to produce, while a liter of cow milk requires 1,050 liters, according to a report conducted by the Climate Society of Columbia University. 

Oatly has had some prominent celebrity investors back the company, including Oprah and Natalie Portman, but it wasn’t until May 2021 that the average investor could snatch up shares of the company as well. 

Oatly’s revenue more than doubled in 2020 and the number of liters the company produced during the year spiked by 81%. Unfortunately, the company’s share price hasn’t performed as well and is down about 28% from its IPO price (as of Oct. 15, 2021).  

Investors looking for an established vegan company with long-term potential may want to keep a close eye on Oatly though. From a sustainability standpoint, Oatly is laser-focused. 

The company releases a sustainability report for its own company every year, highlighting what it does right, as well as pointing out areas where it can do better. 

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The Hain Celestial Group Inc. (NASDAQ: HAIN)

  • Hain Celestial (NASDAQ:HAIN)
  • Price: $38.42 (as of close Dec 1, 2021)
  • Market Cap: $3.569B

If you’re looking for a company focused exclusively on vegan products, Hain isn’t your stock. But the company does deserve a spot on this list because it sells plant-based meat products through its Yves brand and plant-based sausages through its Linda McCartney brand. 

The organic and natural products company also sells a variety of healthy and vegetarian products and is very focused on sustainability. 

Hain wants its operating facilities to be powered by 100% renewable energy and reach zero food waste for its manufacturing plants by 2025. And the company wants its operating facilities to send zero waste to landfills by the same year.

While sales dipped slightly in the company’s fiscal 2021 year, Hain’s management expects

adjusted net sales to grow by a low-single-digit percentage in fiscal 2022. 

Investors will be pleased to know that Hain has been a solid investment over the past few years, as it’s climbed 78% over the past three years, including a 25% spike over the past 12 months. 

United Natural Foods Inc. (NYSE: UNFI)

  • United Natural Foods (NYSE:UNFI)
  • Price: $47.39 (as of close Dec 1, 2021)
  • Market Cap: $2.747B

You may not have heard of United Natural Foods, but if you’ve ever shopped at Whole Foods then you’ve certainly seen their products.

The company doesn’t sell vegan products exclusively, but it is one of the largest publicly traded healthy food distributors, which includes more than 5,000 organic, non-GMO, natural, and vegan foods.

Whole Foods is by far the company’s largest customer, accounting for about 18% of the company’s revenue in 2020, and just a few months ago the company extended its distribution agreement with the healthy grocery store chain through 2027. 

In early 2021, United Natural Foods released a 10-year sustainability plan with the goal of reducing its food waste by 50% by 2025, using 20% of its electricity from renewable sources by 2023, and achieving zero waste to landfills from its distribution centers by 2030.  

Like other companies on this list, investors will need to keep an eye on the company’s profitability, which fell in fiscal 2021 to $149 million, down from $274 million the previous year. 

But with the company’s leading position in the healthy food distribution market and its long-term deal with Whole Foods, United Natural Foods is still worth a look from long-term investors. 

And the fact that the company’s share price has skyrocketed 142% over the past 12 months shows that investors have faith in this natural foods wholesaler. 

Chris Neiger has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Beyond Meat, Inc. and Tattooed Chef, Inc. Millennial Money is part of The Motley Fool network. Millennial Money has a disclosure policy.

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