US$6.65: That's What Analysts Think Sweetgreen, Inc. (NYSE:SG) Is Worth After Its Latest Results
Sweetgreen, Inc. (NYSE:SG) shareholders are probably feeling a little disappointed, since its shares fell 5.6% to US$5.39 in the week after its latest second-quarter results. Revenues were in line with expectations, at US$193m, while statutory losses ballooned to US$0.22 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Following last week's earnings report, Sweetgreen's 14 analysts are forecasting 2026 revenues to be US$682.1m, approximately in line with the last 12 months. The company is forecast to report a statutory loss of US$0.074 in 2026, a sharp decline from a profit over the last year. Before this earnings report, the analysts had been forecasting revenues of US$706.5m and earnings per share (EPS) of US$0.094 in 2026. The analysts have made an abrupt about-face on Sweetgreen, administering a small dip in to revenue forecasts and slashing the earnings outlook from a profit to loss.
Check out our latest analysis for Sweetgreen
The average price target fell 15% to US$6.65, implicitly signalling that lower earnings per share are a leading indicator for Sweetgreen's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Sweetgreen analyst has a price target of US$10.00 per share, while the most pessimistic values it at US$4.40. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's pretty clear that there is an expectation that Sweetgreen's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 0.1% growth on an annualised basis. This is compared to a historical growth rate of 16% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 9.5% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Sweetgreen.
The Bottom Line
The most important thing to take away is that the analysts are expecting Sweetgreen to become unprofitable next year. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Sweetgreen's future valuation.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Sweetgreen going out to 2028, and you can see them free on our platform here.
You should always think about risks though. Case in point, we've spotted 4 warning signs for Sweetgreen you should be aware of, and 2 of them are significant.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.