What Happened?
Shares of casual salad chain Sweetgreen (NYSE: SG) jumped 3.9% in the morning session after RBC Capital raised its price target on the stock, and the company launched a new value-focused promotional meal. The investment bank increased its price target to $8 from $7 while keeping an Outperform rating on the shares. This analyst action coincided with the company's introduction of the 'Tis the Seasoned Harvest Bowl with Blackened Chicken. The meal was offered nationwide for a limited time at a price of $10 for members of its loyalty program. This was seen as one of the chain's strongest value plays yet to attract customers.
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What Is The Market Telling Us
Sweetgreen’s shares are extremely volatile and have had 56 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 7 days ago when the stock gained 5.1% on the news that the company announced its debut in Sacramento with the opening of two new restaurant locations. This expansion marked the company's entry into the Sacramento market and continued its nationwide growth. The first of the two restaurants opened its doors, with a second location planned to open later in the month. For a restaurant brand, entering new cities is a key part of growing the business and reaching more customers, which investors often viewed as a positive development for future sales.
Sweetgreen is down 78.8% since the beginning of the year, and at $6.82 per share, it is trading 82.4% below its 52-week high of $38.83 from December 2024. Investors who bought $1,000 worth of Sweetgreen’s shares at the IPO in November 2021 would now be looking at an investment worth $137.68.
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