Sweetgreen (NYSE:SG) Shares Gap Down on Disappointing Earnings

Sweetgreen, Inc. (NYSE:SG)’s stock price gapped down before the market opened on Friday after the company announced weaker than expected quarterly earnings. The stock had previously closed at $6.25, but opened at $5.25. Sweetgreen shares last traded at $5.6890, with a volume of 3,547,202 shares traded.

The company reported ($0.31) EPS for the quarter, missing analysts’ consensus estimates of ($0.18) by ($0.13). Sweetgreen had a negative net margin of 16.55% and a negative return on equity of 25.06%. The business had revenue of $172.39 million for the quarter, compared to analyst estimates of $179.29 million. During the same period last year, the business posted ($0.18) earnings per share. Sweetgreen’s revenue for the quarter was down .6% on a year-over-year basis. Sweetgreen has set its FY 2025 guidance at EPS.

Analyst Upgrades and Downgrades

A number of analysts have commented on SG shares. Piper Sandler dropped their price target on shares of Sweetgreen from $12.00 to $9.00 and set a “neutral” rating on the stock in a research report on Friday. Oppenheimer set a $10.00 price objective on shares of Sweetgreen in a research note on Friday. Bank of America reissued a “neutral” rating and set a $9.50 target price (down previously from $18.00) on shares of Sweetgreen in a report on Monday, October 6th. Weiss Ratings reaffirmed a “sell (d-)” rating on shares of Sweetgreen in a research note on Wednesday, October 8th. Finally, Barclays lowered their price target on Sweetgreen from $10.00 to $8.00 and set an “equal weight” rating on the stock in a research report on Wednesday, October 22nd. Five investment analysts have rated the stock with a Buy rating, nine have issued a Hold rating and three have given a Sell rating to the stock. Based on data from MarketBeat, the company has a consensus rating of “Hold” and a consensus price target of $12.04.

Insiders Place Their Bets

In related news, CFO Mitch Reback sold 11,530 shares of the firm’s stock in a transaction that occurred on Monday, August 18th. The shares were sold at an average price of $9.19, for a total transaction of $105,960.70. Following the completion of the sale, the chief financial officer directly owned 322,891 shares in the company, valued at approximately $2,967,368.29. This trade represents a 3.45% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available at the SEC website. Insiders own 19.78% of the company’s stock.

Institutional Investors Weigh In On Sweetgreen

A number of institutional investors and hedge funds have recently modified their holdings of the stock. Teacher Retirement System of Texas bought a new stake in shares of Sweetgreen during the 1st quarter worth $378,000. Bank of New York Mellon Corp lifted its holdings in shares of Sweetgreen by 1.4% during the first quarter. Bank of New York Mellon Corp now owns 308,247 shares of the company’s stock valued at $7,712,000 after purchasing an additional 4,333 shares during the last quarter. Brown Advisory Inc. boosted its position in shares of Sweetgreen by 6.7% in the 1st quarter. Brown Advisory Inc. now owns 118,560 shares of the company’s stock valued at $2,966,000 after purchasing an additional 7,395 shares during the period. New York State Common Retirement Fund increased its stake in Sweetgreen by 352.0% in the 1st quarter. New York State Common Retirement Fund now owns 242,472 shares of the company’s stock worth $6,067,000 after purchasing an additional 188,830 shares in the last quarter. Finally, Stephens Investment Management Group LLC increased its stake in Sweetgreen by 52.1% in the 1st quarter. Stephens Investment Management Group LLC now owns 1,354,818 shares of the company’s stock worth $33,898,000 after purchasing an additional 464,013 shares in the last quarter. Institutional investors and hedge funds own 95.75% of the company’s stock.

Sweetgreen Trading Down 7.9%

The stock has a market cap of $680.30 million, a price-to-earnings ratio of -5.93 and a beta of 1.94. The company has a fifty day simple moving average of $7.85 and a 200-day simple moving average of $11.63.

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.