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Sweetgreen

SG
18
Restaurants · Consumer Cyclical
Price
$7.08
+0.86 (+13.83%)
Market Cap
$841.3M
Winston Score
18
Winston is worried
Weak fundamentals across most pillars.

Share count rising — dilution

+8.4% over 4y

The company has issued more shares over this period, which dilutes each existing shareholder’s stake.

Diluted shares outstanding: 108.8M (2021) → 118.0M (2025)

Sweetgreen is a fast-casual restaurant chain that sells salads, grain bowls, and warm plates made from fresh, locally sourced ingredients. It targets health-conscious consumers, mostly in urban areas, and positions itself as a healthier alternative to traditional fast food. The company operates around 230 locations across major U.S. cities like New York, Los Angeles, and Chicago.

Sweetgreen makes money by selling food directly to customers in its restaurants and through its own app and third-party delivery platforms. It has invested heavily in a loyalty app and is piloting automated "Infinite Kitchen" locations that use robots to assemble orders, which could lower labor costs over time. The company is not yet profitable, and its negative operating margin reflects high labor, food, and real estate costs — the main risk is whether it can scale enough locations to reach profitability before its cash reserves run thin.

Winston Score History

Score breakdown

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Quality

Gross Margin
-1.5%
Thin — -1.5% gross margin
Operating Margin
-19.6%
Losing money on operations — -19.6%
ROCE
-3.8%
Weak — -3.8% return on capital

Negative ROIC means the business is losing money on every dollar invested in it.

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Growth

Sales YoY
-1.5%
Shrinking sales (-1.5% YoY)
EPS YoY
N/A
Data not available
EPS Consistency
2/8 quarters
Earnings rarely grow — volatile business

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Cash Flow

Cash Conversion
-100%
Weak — only -100% of profit becomes cash
FCF Margin
-17.9%
Burning cash (-17.9%)

Free cash flow is negative. They are burning cash, not generating it.

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Stability

Debt / Equity
0.73
Moderate — manageable debt (0.73)
Interest Cover
N/A
Data not available

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Valuation

P/E Ratio (TTM)
54.5x
Expensive — P/E 54.5

P/E over 35. The market is pricing in heavy, sustained growth.

P/E vs Forward
N/A
not available
Data not available

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Dividends

Not applicable for this business.
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