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Sweetgreen: No Catalyst For Stock Price To Inflect In FY23

Jun. 01, 2023 3:16 AM ETSweetgreen, Inc. (SG)5 Comments
Heinsite Capital profile picture
Heinsite Capital


  • I expect the stock price to be range-bound until the business shows a visible path to profits and slower but sustained growth.
  • The reported 1Q23 comps growth indicate weak growth, both in urban and suburban areas, which is not the recovery growth I am expecting.
  • The business may see a growth inflection in FY24 as traffic returns to urban.
Peach, blueberry and arugula fresh fruit salad with cheese and almond nuts, top view



Sweetgreen's (NYSE:SG) stock price is pretty much range-bound since the last time I wrote about it (where I adjusted my recommendation from buy to hold). I believe there will be a time to invest in SG again when the

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Heinsite Capital profile picture
I am an investment analyst in a small boutique firm, covering companies across APAC and US.With over 5 years of dissecting businesses and what makes them tick, I look for opportunities in the markets and am not confined to a particular strategy. I look for strong companies with superior moats, but also believe strongly in managing risks to survive to fight another day.

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Comments (5)

ON FIRE! Why? anyone know? short squeeze?
Sg on the move! not 100% what is moving it, but both CAVA and SG were up 7% today. SG is roughly 7.3x the market cap with a similar number of stores.

Maybe hedge funds are going long SG and short CAVA?

Makes sense to me
@thewideopenroad Sorry, "not 100% sure what is moving it"

and "CAVA is 7.3x the market cap of SG"
SG has turned the corner IMHO. Last quarter, they beat the numbers and the stock went up for the first time in...ever. I think they have learned that they have to beat numbers and move up profitability.

I think CAVA's success is going to motivate them more. My knock on SG is that they seem arrogant and feel that they are so brilliant and special. CAVA blasting by them will motivate them to get movin'!

Also, pick up only and infinite kitchen will help profitability. They will start rolling out more of them.

Lastly, the 3 day in office work week is turning into the 4 day week. Soon, it will be 5. While SG is now focusing on the suburbs, the return to office will help their legacy urban stores.
I'd like to see them continue to take aim at Chipotle with their increased menu offering. I think there's an opportunity there especially as it relates to their infinite kitchen offering.

One of the pain points that Chipotle experiences are lines. You eliminate those lines with just kiosks, and you provide more menu items comparable to CMG and you might have something here.
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