Sweetgreen (NYSE:SG) Reaches New 1-Year Low on Disappointing Earnings

Key Points

• Sweetgreen's share price hit a new 52-week low of $8.82 following a disappointing earnings report, with a loss of ($0.20) EPS against the expected ($0.12).
• Several analysts have downgraded their price targets for Sweetgreen, with TD Cowen reducing it from $15.00 to $10.00 and Morgan Stanley from $22.00 to $17.00.
• Despite recent poor performance, 95.75% of Sweetgreen’s shares are held by institutional investors, indicating significant institutional faith in the company’s future.

Sweetgreen, Inc. (NYSE:SG - Get Free Report) shares hit a new 52-week low during trading on Friday following a weaker than expected earnings announcement. The company traded as low as $8.82 and last traded at $9.06, with a volume of 1130161 shares trading hands. The stock had previously closed at $12.66.

The company reported ($0.20) earnings per share (EPS) for the quarter, missing analysts' consensus estimates of ($0.12) by ($0.08). Sweetgreen had a negative return on equity of 21.91% and a negative net margin of 14.29%. The business had revenue of $185.58 million for the quarter, compared to analyst estimates of $193.47 million. During the same quarter in the previous year, the company earned ($0.13) EPS. The business's revenue for the quarter was up .5% on a year-over-year basis.

Analyst Ratings Changes

SG has been the topic of several analyst reports. TD Securities reiterated a "hold" rating and set a $15.00 price target (down previously from $25.00) on shares of Sweetgreen in a research report on Tuesday, July 1st. Wells Fargo & Company reiterated an "overweight" rating and set a $19.00 price target on shares of Sweetgreen in a research report on Tuesday, July 1st. Oppenheimer reduced their price target on shares of Sweetgreen from $35.00 to $29.00 and set an "outperform" rating on the stock in a research report on Friday, May 9th. Bank of America reduced their price target on shares of Sweetgreen from $27.00 to $22.00 and set a "buy" rating on the stock in a research report on Friday, July 18th. Finally, The Goldman Sachs Group reduced their price target on shares of Sweetgreen from $23.00 to $15.00 and set a "neutral" rating on the stock in a research report on Wednesday, June 4th. Eight research analysts have rated the stock with a hold rating and six have issued a buy rating to the stock. According to data from MarketBeat, the company currently has a consensus rating of "Hold" and a consensus target price of $17.69.

Insider Activity at Sweetgreen

In related news, Director Clifford Burrows acquired 19,200 shares of the company's stock in a transaction that occurred on Friday, May 23rd. The stock was acquired at an average price of $13.11 per share, with a total value of $251,712.00. Following the purchase, the director directly owned 19,200 shares in the company, valued at approximately $251,712. This trade represents a ∞ increase in their ownership of the stock. The purchase was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this link. Also, CFO Mitch Reback sold 10,088 shares of the stock in a transaction that occurred on Friday, May 16th. The shares were sold at an average price of $15.23, for a total transaction of $153,640.24. Following the completion of the transaction, the chief financial officer directly owned 334,421 shares of the company's stock, valued at approximately $5,093,231.83. The trade was a 2.93% decrease in their position. The disclosure for this sale can be found here. 19.78% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On Sweetgreen

Several large investors have recently modified their holdings of the business. Wellington Management Group LLP increased its position in shares of Sweetgreen by 30.0% during the first quarter. Wellington Management Group LLP now owns 5,762,598 shares of the company's stock worth $144,180,000 after buying an additional 1,330,094 shares during the period. Champlain Investment Partners LLC acquired a new stake in Sweetgreen in the first quarter worth $31,558,000. Stephens Investment Management Group LLC grew its holdings in Sweetgreen by 89.5% in the second quarter. Stephens Investment Management Group LLC now owns 2,567,526 shares of the company's stock worth $38,205,000 after purchasing an additional 1,212,708 shares during the period. Blair William & Co. IL grew its holdings in Sweetgreen by 891.1% in the second quarter. Blair William & Co. IL now owns 1,157,405 shares of the company's stock worth $17,222,000 after purchasing an additional 1,040,629 shares during the period. Finally, Durable Capital Partners LP grew its holdings in Sweetgreen by 29.5% in the first quarter. Durable Capital Partners LP now owns 4,525,109 shares of the company's stock worth $113,218,000 after purchasing an additional 1,030,176 shares during the period. Institutional investors own 95.75% of the company's stock.

Sweetgreen Price Performance

The firm has a market capitalization of $1.12 billion, a price-to-earnings ratio of -11.35 and a beta of 2.04. The business's fifty day simple moving average is $13.38 and its 200 day simple moving average is $18.97.

Sweetgreen Company Profile

Sweetgreen, Inc, together with its subsidiaries, operates fast food restaurants serving healthy foods at scale in the United States. The company also accepts orders through its online and mobile ordering platforms, as well as sells gift cards that do not have an expiration date and can be redeemed. The company was founded in 2006 and is headquartered in Los Angeles, California.