Sweetgreen slips after Q4 miss, wildfires update

SWEETGREEN

27/02/2025 15:16

** Shares of salad chain Sweetgreen SG.N down 2.4% at $22.58 early Thurs after qtrly results missed expectations, and co provided 2025 outlook

** Los Angeles-based restaurant firm late Weds said Q4 rev grew 5% y/y to $160.9 mln as same-store sales (SSS) increased 4%. Analysts had called for rev of $161.9 mln and SSS up 6.1%, per LSEG

** Adj loss/sh of 25 cents in qtr exceeded consensus by 5 cents

** On the call with analysts, co said extreme weather in Jan and Feb affected guest traffic in 60% of its fleet

** The wildfires in LA, a market representing nearly 15% of its rev, also significantly disrupted operations though didn't physically damage locations, co said

** As such, co forecasted Q1 rev of $163-$166 mln and SSS to decline 3%-5%

** For the full-year, it sees rev of $760-$780 mln and SSS to increase 1%-3%

** At least 5 brokerages reduce PTs, including JP Morgan ($32 from $38), Citigroup ($39 from $43) and UBS ($35 from $45)

** Of 12 brokerages covering SG, recommendations are 8 "strong buy" or "buy", 4 "hold"; median PT of $34 down from $42 a month ago

** With move on Thurs, stock down ~29% YTD and has halved from 1-yr high hit in Nov

(Lance Tupper is a Reuters market analyst. The views expressed are his own)

((lance.tupper@tr.com 1-646-279-6380))