Sweetgreen (SG, Financial) has been on an absolute tear in 2024, with its stock exploding over 210% year-to-date. Known for its fresh salads, eco-friendly practices, and tech-forward approach, the fast-casual chain is winning over customers—and investors—in a big way. With digital sales accounting for 55% of its Q3 revenue and a 19.7% boost in sales over the past three quarters, it's clear Sweetgreen is riding the wave of consumer demand for healthier dining options. Plans for 40 new restaurants in 2025, including its futuristic Infinite Kitchen concept, have only added fuel to the fire.
But before you pile in, take a closer look under the hood. Sweetgreen is still losing money—posting a $20.8 million net loss in Q3—and its annual per-store revenue hasn't budged from $2.9 million since last year. Then there's the insider selling. CFO Mitch Reback and co-founder Nicolas Jammet recently sold significant shares, raising questions about leadership's confidence in the company's lofty $4 billion valuation. At 6.4x price-to-sales, Sweetgreen's stock is up 200% on this metric alone, leaving little margin for error if growth slows.
Analysts are split. TD Cowen is all-in, naming Sweetgreen a top pick thanks to its aggressive expansion plans and tech innovation. On the flip side, KeyBanc Capital Markets is more cautious, pointing to an inflated valuation and unproven profitability. Sweetgreen's momentum is undeniable, but the real test will be whether it can sustain this growth—or if the market's enthusiasm has overshot reality. Investors, tread carefully.
