In a report released today, Brian Harbour from Morgan Stanley maintained a Hold rating on Sweetgreen, with a price target of $10.00.
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Brian Harbour has given his Hold rating due to a combination of factors impacting Sweetgreen’s current financial and operational status. The company is facing significant challenges within the fast-casual sector, with recent decisions such as selling the Spyce unit and reducing unit growth for 2026 aimed at improving its cash position. Despite these efforts, Sweetgreen still needs to demonstrate tangible improvements to regain investor confidence, especially with new management in place.
Sweetgreen’s recent financial performance has been underwhelming, with same-store sales significantly below expectations and a notable decline in key customer demographics. The company’s revenue was slightly protected by new store productivity, but margins have suffered due to increased food and labor costs. Looking forward, Sweetgreen plans to enhance its value messaging and introduce entry-level pricing, but it remains to be seen how effective these strategies will be in reversing the current downward trend.
Harbour covers the Consumer Cyclical sector, focusing on stocks such as Starbucks, Brinker International, and Yum! Brands. According to TipRanks, Harbour has an average return of -1.9% and a 42.42% success rate on recommended stocks.