HomeBusinessSweetgreen, this year's fastest-rising restaurant stock, is making another big move

Sweetgreen, this year’s fastest-rising restaurant stock, is making another big move

Fresh fast-casual chain Sweetgreen rose Friday after reporting first-quarter earnings and raising its guidance. A number of analysts have increased their price targets for SG shares following the results. Sweetgreen is the fastest riser this year among IBD’s 27-stock restaurant group.




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Sweet green (SG) reported a loss of 23 cents per share, compared with 30 cents per share last year. Sales for the salad and bowl-style meal server rose 26% to $157.9 million.

The results fell short of FactSet analyst expectations for a loss of 18 cents per share, but beat expectations for revenue of $152 million.

Same-store sales rose 5%, ahead of expectations for 3.7% growth. Sweetgreen noted that there is strong demand for the protein plates at dinner. The company is also introducing additional menu items, including steak.

Sweetgreen has raised its 2024 revenue guidance to $660 million to $675 million, up from its previous guidance of $655 million to $670 million. Analysts estimate full-year revenue will rise 15% to $671.6 million.

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The company raised its comparable sales guidance to 4% to 6% growth, up from previous expectations of a 3% to 5% increase.

Starting next year, Sweetgreen expects to return to a new unit growth rate of 15% to 20% per year.

JPMorgan said Friday morning that the quarterly results inspire confidence in the Sweetgreen brand’s momentum, noting that the revenue decline “reaffirms this position as the company steadily rebuilds credibility,” the Fly reported. JPMorgan raised its price target to $30 from $28 and maintained an overweight rating on the stock.

TD Cowen and Citi also modestly raised their price targets for Sweetgreen shares. Both companies have a neutral or hold rating on the stock.

SG stock

SG shares rose 36% early Friday, on track for a consecutive week of gains.

Shares are trading at their highest level since April 2022.

Sweetgreen — a MarketSurge Growth 250 stock — rose 108.5% so far this year through Thursday, marking the biggest gain in the Retail-Restaurants industry group. CAVA group (CAVA) is in second place with a gain of 75.4% through Thursday, followed by Wing stop (WING) with an advance of 55%. The group holds a strong number 12 among the 197 industries tracked by IBD.

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You can follow Harrison Miller for more stock market news and updates on Twitter @IBD_Harrison

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