There was a time when plant-based burgers and related food products were all the rage on Wall Street. The business-news media heavily covered the best vegan stocks to buy. Many pundits, including myself, wrote about the potential, future initial public offerings of rising stars within the sector such as Impossible Foods. 

Many believed plant-based foods were a license to print money. But, unfortunately, the industry’s bold predictions turned out to be more sizzle than steak. 

The IPO market has slowed, and investors’ demand for vegan stocks appears to have fallen off a cliff. Only the most ardent supporters are talking up the industry these days. It seems that it is in a deep freeze, much like the one that cannabis has faced, only worse because the vegan sector is smaller than the cannabis space on a global scale. 

According to one estimate, the plant-based meat market will be worth $15.7 billion by 2027. Another forecast predicts that, in the same year, the cannabis market will reach $82.3 billion, more than five times the size of the plant-based meat space. 

In December 2019, I wrote a column called the 7 Stocks to Buy to Ride the Vegan Wage. Even back then, you could see that a full-scale exodus of meat eaters to veganism wasn’t going to happen. 

More than three years later, I’m tasked with coming up with three vegan stocks to buy for 2023. Here are my choices.

Ingredion (INGR)

Ingredion (NYSE:INGR) is the largest of my three vegan stocks to buy. It has a market cap of $6.7 billion, putting it solidly in the mid-cap-stock camp. Food companies come to Ingredion when they need ingredients to help their products fly off the grocery store shelves. 

Based outside Chicago, Ingredion has more than 19,000 customers spread across 120 countries worldwide. Its ingredients are made in its 46 manufacturing facilities on five continents. 

In Q3, its sales climbed 15% versus the same period a year earlier to $2.02 billion, with an operating income of $182 million, up from $172 million in Q3 of 2021. The company’s Specialty Ingredients segment generated 33% of the firm’s overall revenue in Q3 of 2022.

One of the growth catalysts for the Specialty Ingredients division is plant-based proteins. Using pulse-based proteins such as chickpeas, lentils, fava beans, and peas helps manufacturers create products with more protein, dietary fiber, and better texture.

In 2015, Specialty Ingredients accounted for 24% of the company’s revenue. By 2025, INGR expects the unit to generate 40% of its $8 billion of revenue. 

The seven analysts who cover INGR have an average rating of “overweight” on the shares with a mean price target of $103.60 on the name, slightly above where it closed on Friday. Based on the midpoint of its guidance, the company  is calling for full-year earnings per share, excluding some items,  of $7.18. Its shares trade at a reasonable 14.3 times its earnings. 

It’s a relatively safe way to lean into the vegan and vegetarian movement.  

Hain Celestial Group (HAIN)

I’ve been a fan of Yves Veggie Cuisine products since I gave up meat about seven years ago. Of course, it helped that Yves, a maker of plant-based snacking and meal options for vegans and vegetarians,  got its start in Canada (where I live) in 1985. I especially like Yves’ fake bacon and fake bologna.

Hain Celestial Group (NASDAQ:HAIN) bought Yves in June 2001. At the time, the latter firm was generating $50 million of revenue, with most of its sales coming from grocery stores and mass-market retailers. The acquisition was part of former Hain CEO Irwin Simon’s quest to make the company a global powerhouse in the healthy, natural food sector. 

Hain, however,  didn’t quite accomplish that goal, and Simon was pushed out in June 2018 after founding the company more than 25 years earlier. He’s now the CEO of Tilray Brands (NASDAQ:TLRY). 

Mark Schiller took over from Simon, spending the last four years selling some of the company’s units. Schiller stepped down at the end of December, but only after selling its Westbrae Natural Brand division, which had spent 25 years under the Hain Celestial umbrella, to the makers of Bush Beans in December. 

Under Schiller, Hain became more  focused on the North American market. His successor, Wendy Davidson, has been an executive for several large packaged goods companies, including Kellogg (NYSE:K), McCormick & Co. (NYSE:MKC), and Tyson Foods (NYSE:TSN). 

Down more than 50% over the past five years, HAIN stock is the perfect contrarian play for 2023.

MGP Ingredients (MGPI)

MGP Ingredients (NASDA Q:MGPI) had an excellent year in 2022, as its stock gained 25%. 

In April 2021, MGP bought Luxco, the maker of spirit brands such as Ezra Brooks, Rebel Yell, and many others, for $475 million, continuing its efforts to acquire higher-margin businesses.    

Before MGP acquired Luxco, which added approximately $200 million to its annual top line, it had two main businesses: Distilling Solutions and Ingredient Solutions. The former unit makes distilled spirits for other manufacturers. The latter division creates specialty wheat starches, wheat proteins, commodity wheat starches, and commodity wheat proteins.  

In Q3, MGP’s sales rose 14% year-over-year to $201.2 million, as the sales of all three of its operating segments climbed, and its operating income increased 2% to $33.2 million. For all of 2022, it expects top-line revenue of at least $765 million with EBITDA, excluding some items, of $162 million. The firm predicts that its EBITDA margin will come in at 21.2%. 

The company’s gross margins will increase as inflation moderates, causing its profits to rise. While the Ingredient Solutions business is a small part of MGP’s sales, it provides the company with greater diversification.

With MGP trading at 25.7 times its  cash flow, the stock’s  price-cash flow multiple is lower than its five-year average of 29 times.

On the date of publication, Will Ashworth did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.