Last month, shares of Oatly Group dropped 10%. Due to continued negative sentiment from analysts, it became one of the few IPOs in 2021. In May, Oatly did not have any major news to report. However, some of the concerns that weighed on the stock included the potential impact of rising interest rates. The stock fell 10.6% in the first three days of the year after HSBC initiated coverage on Oatly with a sell rating and a target price of $7.
The stock’s decline is similar to Beyond Meat, which went public in 2014 and then faded after its growth slowed. Despite growing at a robust rate, the company is still losing money due to its expansion in the Americas. Over the long term, it still has a promising track record. The decrease in Oatly’s stock was a continuation of its decline from earlier last year’s second quarter as investors became increasingly skeptical of the company’s valuation. Oatly doesn’t have a true rival in the almond-milk category, but in 2017, WhiteWave, which owns the Silk brand, was purchased by Danone for $12.5 billion.