What Happened?
Shares of casual salad chain Sweetgreen (NYSE: SG) fell 6.3% in the morning session after an analyst at UBS lowered their rating on the stock. The bank changed its view on the company's shares, moving it from a "Buy" to a "Neutral" rating.
A downgrade of this nature typically signals that the analyst expects the stock's performance to be more in line with the average market return in the near future, rather than significantly beating it. This action added to a recent pattern of analyst caution, as it followed a downgrade from Wells Fargo in the preceding month.
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What Is The Market Telling Us
Sweetgreen’s shares are extremely volatile and have had 54 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 6 days ago when the stock dropped 5.8% on the news that the departure of its Chief Development Officer, Chris Tarrant, and a price target cut from Morgan Stanley highlighted ongoing business struggles. The executive's exit marked the second leadership change in a month, following the recent retirement of co-founder Nathaniel Ru. These shifts occurred as the salad chain faced weaker trading, with same-store sales having declined for three consecutive quarters in 2025. In response to the challenges, Sweetgreen scaled back its growth plans, now aiming to open between 15 and 20 new locations, down from a previous projection of 37. Adding to the pressure, Morgan Stanley lowered its price target on the stock to $9.00 from $10.00.
Sweetgreen is down 3.4% since the beginning of the year, and at $6.69 per share, it is trading 80.1% below its 52-week high of $33.71 from January 2025. Investors who bought $1,000 worth of Sweetgreen’s shares at the IPO in November 2021 would now be looking at an investment worth $135.19.
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