When Beyond Meat went public in May 2019, investors went a little crazy. On its first day of trading, the company’s stock rose 163%. That was the kind of move that hadn’t been seen since the peak of the dot-com bubble nearly two decades earlier.

Within just two months, the Beyond Meat stock price had risen more than eightfold. And though that rally even at the time looked like a bit much, investor optimism didn’t totally cool. As recently as June 2021, Beyond Meat’s market capitalization was just shy of $10 billion.

Since then, investor sentiment has done a complete U-turn. Beyond Meat stock now trades at an all-time low; shares are down 97% from their peak. The company’s market value currently is barely $500 million, and even that is potentially inflated:

Proportionally speaking, only five stocks in the entire U.S. market have more short sellers betting against them than does BYND.

Given the number of investments over the past few years that have seen similar highs and lows (electric vehicle stocks, non-fungible tokens, GameStop), it’s tempting to assume that what has happened to Beyond Meat was a textbook bubble. In that telling, the decline from the 2019 and 2021 peaks is simply the stock market coming to its senses, and properly valuing a business that should not have driven so much optimism to begin with.

But that is absolutely not the case. Rather, the primary reason Beyond Meat stock has collapsed is because the Beyond Meat business has collapsed — and in a rather stunning manner.

In 2015, Beyond Meat generated sales of less than $9 million. In 2019, revenue surged to just shy of $300 million net of discounts. That year, in terms of net profit the business was running essentially at breakeven (excluding a non-cash charge driven by accounting rules) and gross margins were 33% of sales.

In 2020, the business performed exceptionally well through the novel coronavirus pandemic. Revenue increased another 37%, clearing $400 million, despite significant pressure on foodservice customers. Gross margin dipped to 30%, but in the context of labor and supply chain challenges, that decline was understandable.

Entering 2021, Beyond Meat looked like a good business, with strong sales growth setting up a future of solid profits. But that year, cracks started to show.

Sales rose just 14% — and actually declined year-over-year in the U.S. In the fourth quarter, total sales growth turned negative, and that proved to be a harbinger of an absolutely disastrous 2022.

That year, global sales dropped 10% and Beyond Meat’s gross margins turned negative: it actually cost Beyond Meat more money just to manufacture and ship its products than it could sell those products for. Incredibly, gross margin compressed by 40 percentage points in three years.

2023 hasn’t been any better. Sales have plunged 24%, including a 35% drop in the U.S. Gross margins are less than 5%.

The plant-based category as a whole has been a problem. Demand clearly has faded, and competition has increased.

Other potential winners in the space too are struggling. Tattooed Chef has gone bankrupt. Oat milk leader Oatly has seen its stock fall 97% from an all-time high.

The whole industry clearly is struggling. Consumers clearly have concerns about the level of processed ingredients in plant-based foods.

For Beyond Meat in particular, a sharp increase in costs has left the company with only bad options: raising prices that will make plant-based meat far more expensive than the traditional options, or running the business at a loss. For now, it’s choosing the latter, and hoping it can find a way to grow out of its troubles.

Right now, that seems unlikely. In fact, the most likely outcome appears to be Beyond Meat following Tattooed Chef into bankruptcy. The credit markets suggest as much: the company’s convertible debt currently trades for about 25 cents on the dollar.

That debt doesn’t come due until 2027, but the company may not even last that long. It only has $210 million in cash remaining, after burning $391 million in 2022. The company had hoped to get close to breakeven in the second half of this year, but admitted after its second quarter report in August that such improvement was unlikely to occur.

At the peak, the valuations of plant-based companies suggested investors believed they could displace traditional food manufacturers. After all, at one point, Oatly, Beyond Meat, and Tattooed Chef had a combined valuation of roughly $25 billion. Beyond Meat itself was worth more than poultry processors Sanderson Farms and Pilgrim’s Pride put together. By last year, in contrast, investors simply hoped plant-based manufacturers could complement their traditional rivals.

Now? Investors quite clearly wonder if the space is large enough to hold anything more than a handful of niche businesses. It’s been a stunning change in belief — but as Beyond Meat’s financial performance shows, it’s not a change that has come out of nowhere.

Vince Martin is an analyst and author whose work has appeared on multiple financial industry websites. He’s the lead writer at Overlooked Alpha, which offers market-wide and single-stock analysis every week.