Value
3.9/10data confidence 50%| Component | Sub-score |
|---|---|
| P/E | 1.3 |
| P/S | 9.3 |
| Analyst target | 3.0 |
SG · Why this verdict
Why Sweetgreen (SG) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score3.2/10
ConfidenceHIGH
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The company has missed earnings in all of the last 3 reported quarters with zero beats, and an average surprise of -41.99%, per the catalyst notes. Catalyst breakdown | The company should return to at least 1 beat out of the next 4 quarters, with average surprise turning positive. | →Stable |
| CounterA clean miss streak this consistent suggests structural estimate-setting problems or genuine operating deterioration, not a one-off stumble. | ||
Quality score of 1.7 sits below the engine's 4.0 floor, with an earnings-quality red flag showing FCF at -478% of net income and a weak Piotroski F-Score of 3 out of 9. Quality breakdown | Quality score should climb toward 4.0 over 12 months if FCF conversion normalizes and the Piotroski score improves. | →Stable |
| CounterAn FCF/NI ratio this negative could reflect one-off working-capital or restructuring charges rather than a persistent structural problem. | ||
Revenue is declining 3% year-over-year, a headwind reflected directly in the engine's growth score. Growth breakdown | Revenue growth should turn positive over the next 12 months if same-store sales trends recover. | →Stable |
| CounterA modest -3% decline for a restaurant chain could reflect temporary same-store sales softness rather than a structural demand problem. | ||
Short interest is elevated at 22% of float, which the engine judges as justified given the fundamental picture, alongside high implied volatility of 96%. Risk breakdown | Short interest should decline below 15% of float over the next 12 months if the fundamental picture stabilizes. | →Stable |
| CounterExtremely high short interest also creates squeeze risk — any positive surprise could force rapid short covering and a sharp price spike. | ||
Insider signal is BULLISH, with 30 buy transactions against only 2 sells and net insider buying of 578,114 shares over the trailing 90 days. Insider | The insider signal should stay BULLISH with continued net buying over the next 12 months. | →Stable |
| CounterA large count of small insider buy transactions can reflect routine equity compensation vesting rather than a strong conviction signal, especially against a backdrop of consecutive earnings misses. | ||
The company has missed earnings in all of the last 3 reported quarters with zero beats, and an average surprise of -41.99%, per the catalyst notes.
→StableCatalyst breakdown
- Expectation
- The company should return to at least 1 beat out of the next 4 quarters, with average surprise turning positive.
CounterA clean miss streak this consistent suggests structural estimate-setting problems or genuine operating deterioration, not a one-off stumble.
Quality score of 1.7 sits below the engine's 4.0 floor, with an earnings-quality red flag showing FCF at -478% of net income and a weak Piotroski F-Score of 3 out of 9.
→StableQuality breakdown
- Expectation
- Quality score should climb toward 4.0 over 12 months if FCF conversion normalizes and the Piotroski score improves.
CounterAn FCF/NI ratio this negative could reflect one-off working-capital or restructuring charges rather than a persistent structural problem.
Revenue is declining 3% year-over-year, a headwind reflected directly in the engine's growth score.
→StableGrowth breakdown
- Expectation
- Revenue growth should turn positive over the next 12 months if same-store sales trends recover.
CounterA modest -3% decline for a restaurant chain could reflect temporary same-store sales softness rather than a structural demand problem.
Short interest is elevated at 22% of float, which the engine judges as justified given the fundamental picture, alongside high implied volatility of 96%.
→StableRisk breakdown
- Expectation
- Short interest should decline below 15% of float over the next 12 months if the fundamental picture stabilizes.
CounterExtremely high short interest also creates squeeze risk — any positive surprise could force rapid short covering and a sharp price spike.
Insider signal is BULLISH, with 30 buy transactions against only 2 sells and net insider buying of 578,114 shares over the trailing 90 days.
→StableInsider
- Expectation
- The insider signal should stay BULLISH with continued net buying over the next 12 months.
CounterA large count of small insider buy transactions can reflect routine equity compensation vesting rather than a strong conviction signal, especially against a backdrop of consecutive earnings misses.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Sweetgreen shows a red-flag earnings-quality signal with declining revenue and a string of earnings misses, and carries high short interest, but heavy insider buying stands in contrast to the otherwise bearish fundamental picture.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
1.7/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 1.2 |
| ROA | 0.0 |
| Gross margin | 0.0 |
| Op margin | 0.0 |
| Net margin | 1.2 |
| Current ratio | 5.8 |
| FCF quality | 0.0 |
| Moat | 3.9 |
| Piotroski F | 3.3 |
- ▸Earnings quality RED FLAG: -478% FCF/NI
- ▸No competitive moat
- ▸Weak Piotroski F-Score: 3/9
- ▸Quality concerns
Growth
1.8/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 1.8 |
- ▸Declining revenue: -3%
Momentum
2.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 1.8 |
| OBV | 1.0 |
| MA position | 3.0 |
| Volume | 0.0 |
- ▸Volume distribution (falling OBV)
- ▸Above 200-MA but MA slope flat
Sentiment
4.9/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 4.8 |
| erm sentiment | 5.0 |
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.0 |
- ▸Insider selling (low materiality) — $131,366 (0.013% of mkt cap)
Peer rank
2.8/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.2 |
| quality rank | 2.3 |
| growth rank | 0.6 |
Technical
4.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 8.0 |
| support resistance | 6.4 |
| 52w position | 0.0 |
| gap | 5.0 |
Risk (lower is worse)
3.9/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 1.3 |
| days to cover | 7.8 |
| volatility | 0.0 |
| put call | 9.9 |
| implied vol | 0.0 |
| max pain risk | 3.0 |
| beta | 2.8 |
| debt equity | 6.6 |
- ▸High short interest justified: 22%
- ▸High IV: 97%
- ▸Above max pain $3
- ▸Concentration risks: 1 HIGH, 1 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
2.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 0.0 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
- ▸Earnings concerns: 0B/3M
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCKPassed (6)
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:32d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:2.3<4.5
- ASYMMETRY:-0.9=NEGATIVE
Warning (0)
none
Reward-to-Risk
-0.93
Upside
-14.0%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilitySpeculative — Drawdown -52% (>40% off 52w high)
Investment implication
The L1 gate blocked the positive-verdict path: a hard-floor threshold was breached, so dimensional pillars — including Insider at 5.0 could not lift the engine output above the verdict floor. Failed gate signal: MOMENTUM:2.3<4.5.
The strongest dimensions are Insider at 5.0, Sentiment at 4.9, and Technical at 4.8; the weakest are Quality at 1.7, Growth at 1.8, and Momentum at 2.3. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of -0.93 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Quality Red Flag Below Floor
Trip ifFCF/NI stays below -200% for 2 more consecutive quarters, or the Piotroski F-Score falls below 4.
- P2Declining Revenue Trend
Trip ifRevenue decline exceeds 5% YoY for 2 more consecutive quarters.
- P3Consecutive Earnings Misses
Trip ifThe company posts a 4th consecutive miss, or the average surprise stays below -25%.
- P4High Short Interest Risk
Trip ifShort interest rises above 30% of float, or implied volatility exceeds 130%.
- P5Bullish Insider Buying Contrarian
Trip ifNet insider selling exceeds 100,000 shares in a rolling 90-day window, or the signal turns BEARISH, within the next 2 quarters.