Why Is Sweetgreen (SG) Stock Rocketing Higher Today
What Happened:
Shares of casual salad chain Sweetgreen (NYSE:SG) jumped 28.1% in the pre-market session after the company reported fourth-quarter results with revenue beating by a small amount, though EPS beat by a more convincing margin. The company continued to record growing success via its digital channel, which now stands at roughly 60% of total revenue. The business is also expanding into new markets after setting up locations in Milwaukee, Tampa, and Rhode Island in 2023. In 2024, the company is expected to add 23 to 27 new restaurants to its tally. As a result, guidance was optimistic, with next quarter's revenue and adjusted EBITDA guidance coming in higher than Wall Street's estimates. Finally, while full-year revenue guidance was in line, adjusted EBITDA was better than Wall Street's estimates. Overall, this was a really good quarter that should please shareholders.
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What is the market telling us:
Sweetgreen's shares are somewhat volatile and over the last year have had 44 moves greater than 5%. But moves this big are very rare even for Sweetgreen and that is indicating to us that this news had a significant impact on the market's perception of the business.
Sweetgreen is up 47.5% since the beginning of the year, and at $16.34 per share it is trading close to its 52-week high of $16.41 from July 2023. Investors who bought $1,000 worth of Sweetgreen's shares at the IPO in November 2021 would now be looking at an investment worth $329.90.
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