Sweetgreen (NYSE:SG) Shares Climb 3.7% - Still a Buy?

Key Points

• Sweetgreen shares rose 3.7% to about $9.50, although trading volume was significantly below average.
• Analyst sentiment remains mixed: six analysts rate the stock Buy, nine Hold and three Sell, resulting in an overall “Hold” rating and an average price target of $7.72.
• The company missed quarterly earnings expectations, reporting a $0.22 per-share loss versus the expected $0.13 loss, while revenue grew 3.8% year over year to $192.66 million. Executives also sold shares to cover tax obligations, and institutional investors own 95.75% of the stock.

Sweetgreen, Inc. (NYSE:SG - Get Free Report)'s share price was up 3.7% during trading on Thursday. The stock traded as high as $9.24 and last traded at $9.4960. 287,839 shares changed hands during trading, a decline of 94% from the average daily volume of 5,097,469 shares. The stock had previously closed at $9.16.

Analyst Ratings Changes

Several research firms have weighed in on SG. DA Davidson reduced their target price on Sweetgreen from $7.00 to $5.50 and set a "neutral" rating on the stock in a report on Monday, August 10th. UBS Group raised Sweetgreen from a "neutral" rating to a "buy" rating in a research report on Friday, August 7th. Wells Fargo & Company upgraded Sweetgreen from an "equal weight" rating to an "overweight" rating and lifted their price objective for the company from $6.00 to $11.00 in a report on Monday, September 28th. Weiss Ratings lowered Sweetgreen from a "sell (d+)" rating to a "sell (d)" rating in a research report on Tuesday, August 11th. Finally, KeyCorp raised Sweetgreen from a "sector weight" rating to an "overweight" rating and set a $9.00 target price for the company in a research note on Tuesday, September 8th. Six research analysts have rated the stock with a Buy rating, nine have issued a Hold rating and three have issued a Sell rating to the stock. Based on data from MarketBeat, the company currently has an average rating of "Hold" and an average price target of $7.72.

Sweetgreen Stock Performance

The stock has a fifty day simple moving average of $7.02 and a 200-day simple moving average of $7.24. The stock has a market cap of $1.12 billion, a P/E ratio of 93.93 and a beta of 2.16.

Sweetgreen (NYSE:SG - Get Free Report) last issued its quarterly earnings results on Thursday, August 6th. The company reported ($0.22) EPS for the quarter, missing analysts' consensus estimates of ($0.13) by ($0.09). The firm had revenue of $192.66 million during the quarter, compared to the consensus estimate of $194.50 million. Sweetgreen had a net margin of 2.01% and a negative return on equity of 32.94%. The business's revenue for the quarter was up 3.8% on a year-over-year basis. During the same quarter last year, the firm earned ($0.20) earnings per share. On average, research analysts anticipate that Sweetgreen, Inc. will post -1.03 earnings per share for the current year.

Insider Buying and Selling

In other Sweetgreen news, CFO Jamie McConnell sold 15,033 shares of the company's stock in a transaction that occurred on Monday, August 17th. The stock was sold at an average price of $6.21, for a total transaction of $93,354.93. Following the completion of the transaction, the chief financial officer owned 210,489 shares of the company's stock, valued at $1,307,136.69. This represents a 6.67% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is available through this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, COO Jason Miles Cochran sold 4,809 shares of the firm's stock in a transaction that occurred on Monday, August 17th. The stock was sold at an average price of $6.21, for a total transaction of $29,863.89. Following the transaction, the chief operating officer directly owned 207,076 shares of the company's stock, valued at $1,285,941.96. This represents a 2.27% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Corporate insiders own 18.19% of the company's stock.

Institutional Investors Weigh In On Sweetgreen

Several hedge funds and other institutional investors have recently added to or reduced their stakes in SG. Eastern Bank increased its position in shares of Sweetgreen by 7.3% in the third quarter. Eastern Bank now owns 27,054 shares of the company's stock valued at $240,000 after acquiring an additional 1,830 shares during the last quarter. Sequoia Financial Advisors LLC acquired a new position in Sweetgreen during the second quarter valued at approximately $90,000. Integrated Wealth Concepts LLC acquired a new position in Sweetgreen during the second quarter valued at approximately $112,000. Proficio Capital Partners LLC bought a new position in Sweetgreen in the second quarter valued at approximately $99,000. Finally, Wellington Management Group LLP bought a new position in Sweetgreen in the second quarter valued at approximately $4,557,000. 95.75% of the stock is currently owned by institutional investors and hedge funds.

About Sweetgreen

Sweetgreen, Inc operates a fast-casual restaurant chain focused on fresh, made-to-order meals. Its menu includes salads, warm grain bowls, protein plates, sides and beverages, with an emphasis on seasonal ingredients, customizable meals and health-conscious dining.

The company serves customers through company-operated restaurants in the United States, as well as digital channels that support online ordering, delivery, pickup and its loyalty program. Sweetgreen also uses technology in restaurant operations, including automated kitchen systems at select locations, to help improve consistency and service efficiency.

Sweetgreen was founded in 2007 by Nicolas Jammet, Jonathan Neman and Nathaniel Ru while they were students at Georgetown University.

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