The hype is there but not much else when it comes to plant-based food company Burcon Nutrascience (Burcon Nutrascience Stock Quote, Charts, News, Analysts, Financials TSX:BU), according to portfolio manager Brian Madden of Goodreid Investment Counsel. Madden has a host of arguments to sway the would-be investor, starting with the fact that despite the growing consumer interest in plant-based proteins, there\u2019s little in the way of institutional investment in Burcon. \u201cThis is a pretty junior company,\u201d said Madden, speaking on BNN Bloomberg on Friday. \u201cWe don't own it and in fact not many institutional investors do. It's got roughly nine or ten per cent institutional ownership and it doesn't really have much of an analyst following either. There are three analysts at junior brokerage firms that do follow the company.\u201d Vancouver-headquartered Burcon, which has protein patents for novel sources like pea, canola, soy and hemp and is now commercially operational at its joint venture protein production facility outside of Winnipeg, saw its stock shoot up in 2019, going from $0.16 per share at the start of the year to $0.97 by the end of December. Some of those gains had to do with the company\u2019s progress with its Merit Foods JV but the spectacle of Beyond Meat\u2019s IPO in May 2019 was also a factor. (All figures in Canadian dollars except where noted otherwise.) Beyond Meat (Beyond Meat Stock Quote, Charts, News, Analysts, Financials NASDAQ:BYND) had one of the most successful go-public offerings in years when it went from an initial price of US$25 per share to as high as US$65.75 by the end of its first trading day. And as more fast food and retail companies jumped on the Beyond Meat wagon over ensuing months, the trend looked like it would sweep Burcon to higher heights, too.\u00a0 And it did \u2014 by early this year BU was trading at an incredible $5.42 at its peak in April, while Beyond Meat has been more or less treading water over the past year and a half (albeit now in US$140 per share territory). One event that got investors talking about Burcon was a collaboration announced in early 2020 with the mother of all food companies, Nestl\u00e9, for the two to work together on plant-based meat and dairy alternatives.\u00a0 \u201cThe partnership combines Nestl\u00e9\u2019s expertise in the development, production and commercialization of plant-based foods and beverages with Burcon\u2019s proprietary plant protein extraction and purification technology, while leveraging Merit\u2019s state-of-the-art plant protein production capabilities,\u201d said Nestl\u00e9 in a press release. Burcon followed that up with an announcement in August, 2020, of an equity partnership with agribusiness and food company Bunge (Bunge Stock Quote, Charts, News, Analysts, Financials NYSE:BG) where Bunge agreed to a $30-million investment in Merit and taking on a 33.3 per cent ownership in Merit.\u00a0 Those seem like steps in the right direction for a company, one which just reported its first royalty revenues on the Merit JV while still working on further partnerships related to its cache of protein patents. But Madden is having none of it, saying there\u2019s a laundry list of problems with Burcon. \u201cIt's about a $320 million company, and what they do is they extract protein from plants \u2014 canola, peas, lentils, that sort of thing. It\u2019s got a lot of intellectual property and they have 285 patents, but what keeps us out of the story is there's negligible revenue despite the company having been around for the better part of 20 years in one form or another,\u201d said Madden. \u201cThese are \u2018show me\u2019 stories and it's difficult to apply the traditional methods of fundamental analysis to companies that don't really have much in the way of revenue or profitability,\u201d he said. \u201cSometimes you can do it if there's revenue but not profits and you can project it into the future, but when there's not even any revenue or credible promise of meaningful revenue it\u2019s difficult to support a $320 million valuation.\u201d \u201cI will also say this company burns cash, as most early stage companies do, and frequently, every couple of years comes to market with a secondary offering which dilutes the value of the shares. And it's also wildly volatile \u2014 the beta or market sensitivity of the stock is about 1.9, so almost twice as volatile as the TSX itself,\u201d Madden said. Burcon delivered its latest quarterly results in August, the company\u2019s fiscal first quarter 2022 for the period ended June 30. There, BU reported $18,000 in royalty revenue from Merit Foods while taking a net loss of $3.2 million or $0.03 per share. The company said the net loss related to Merit reflected operating costs while commissioning and optimizing production. Madden concluded his review saying investors ought to stay on the sidelines with Burcon, at least for now. \u201cJust for context, in the last ten years or so the stock price has been from 21 cents to $6, and everywhere in between. It\u2019s trading roughly in the middle of that range for now,\u201d Madden said.\u00a0 \u201cIt's a bit too speculative for us. The technology might be promising but we'd certainly be taking a wait-and-see approach here and waiting for signs of revenue and, down the road, signs of profit before we got interested in it,\u201d he said.