3 Plant-Based Food Stocks with Potential for Market Expansion

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Since I’m severely lactose, I eat many plant-based foods and drink many plant-based beverages. The data suggests that many other Americans, whether because of lactose intolerance or for other reasons, eat plant-based foods and drink plant-based beverages. Indeed, “The (United States) plant-based food market surged from $3.9 billion in 2017 to $8.1 billion in 2023,” according to Good Food Institute. With so many interested customers, plant-based food stocks are a solid buy.

The institute pointed out that the growth was spurred “by products that appeal to mainstream consumers by mimicking the taste, texture, and functionality of conventional animal products.” Meanwhile, according to Statista, worldwide sales of plant-based meat alone are expected to surge from $10.15 billion in 2023 to $16.78 billion in 2028. For investors who want to profit from the latter trend, here are three growing plant-based food stocks to buy now.

Oatly (OTLY)

otly stock Rolled oats or oat flakes in bowl with wooden spoons
otly stock Rolled oats or oat flakes in bowl with wooden spoons

Source: Vladislav Noseek / Shutterstock.com

Oatly (NASDAQ: OTLY) specializes in making oat-based milk, although it has also branched out to desserts, yogurts, and whipped cream.

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Last quarter, in a very encouraging development, the company reported its first-ever positive EBITDA, excluding certain items, in North America. Moreover, its overall revenue climbed 3.9%, excluding currency changes, versus the same period a year earlier. The latter increase was driven partly by a year-over-year surge of 9.6% in sales volumes, as measured in total liters. Furthermore, the firm expects its revenue growth to come in at 5% to 10% for the full year. Finally, Oatly’s gross margin jumped to 29% last quarter from 19.2% in Q2 of 2023.

Also positively, Oatly gave a major update on its Q2 earnings call last month. The company had received “positive test results with China’s largest coffee chain.” The statement, which likely refers to Luckin Coffee (OTC:LKNCY), suggests that Oatly may benefit over the longer term from being utilized by many of Luckin’s customers.

Since Luckin had 18,500 stores, such a development could very well be needle movers for Oatly and OTLY stock.

All of this positive news makes Oatly one of the best plant-based food stocks to buy now.

Ingredion (INGR)

Ingredion Canada Inc head office in Brampton, Ontario, Canada
Ingredion Canada Inc head office in Brampton, Ontario, Canada

Source: JHVEPhoto / Shutterstock.com

Ingredion 9NYSE:INGR) provides “essential plant-based proteins, starches, texturizers, and other vital ingredients for vegan manufacturers,” The Food Institute explained. The company’s Ultra Performance line contains up to 60% plant protein. It also improves the taste and texture of many foods, including plant-based food and beverages, the company reported in 2022. It accomplishes the latter goal by “using pea protein without the raw plant flavor,” Ingredion explained.