Sweetgreen Shares Slump Amid Growth Stock Sell-Off, Goldman Sachs Maintains Sell Rating
Shares of Sweetgreen (NYSE: SG) extended their decline this week, caught in a downdraft of negative sentiment toward growth-oriented companies. The sell-off was compounded by a reaffirmed bearish stance from Wall Street giant Goldman Sachs, sending the stock down 15.1% for the week as of Friday afternoon.
The broader market context proved challenging. A late-week stumble for technology and high-growth stocks created a headwind for many names, including Sweetgreen. This overshadowed a potentially positive signal from the restaurant industry: Starbucks reported solid U.S. comparable sales growth of 4%, suggesting consumer spending on discretionary items like dining out may be holding up.
Analyst Christine Cho of Goldman Sachs reiterated a Sell rating on Sweetgreen, though she raised the firm's price target from $5 to $5.60. In her note, Cho observed that restaurant stocks have generally outperformed the S&P 500 this year, with potential tailwinds from fiscal policy. However, she indicated that Sweetgreen's specific challenges keep it in the penalty box for now.
The company's journey has been rocky. After a difficult 2025 marked by declining same-store sales and the divestiture of its proprietary automation platform (while retaining usage rights), Sweetgreen is now a "show-me" story for investors. Management turnover has added to the uncertainty, with the recent departures of co-founder and Chief Brand Officer Nathaniel Ru, CFO Mitch Reback, and Chief Development Officer Chris Tarrant.
"The road to recovery is paved with easier year-over-year comparisons in 2026," noted a market analyst familiar with the sector. "But investors need concrete proof of a operational turnaround and a path to sustainable profitability. All eyes will be on the fourth-quarter earnings report due at the end of February."
Investor Reactions
Michael R., Portfolio Manager, Boston: "This is a classic case of a good concept battling execution woes in a tough market. The Goldman note is a reality check. The stock needs more than a market rebound; it needs fundamental improvement in unit economics."
Lisa T., Retail Investor, Austin: "I'm holding. The brand is strong with millennials and Gen Z. This feels like short-term noise. The Starbucks numbers show people are still spending on premium food and drink. Sweetgreen just needs to execute its store strategy."
David K., Independent Analyst (sharper tone): "It's a salad chain trading like a broken tech stock. The executive exodus is a massive red flag the bulls are ignoring. Selling the 'Infinite Kitchen' tech was an admission that their grand automation bet failed. This isn't a dip to buy; it's a value trap."
Sarah J., ESG-focused Investor, San Francisco: "The long-term thesis around health-conscious, sustainable dining remains intact. The current volatility is painful, but for investors with a multi-year horizon, this could be an accumulation zone if management stabilizes the ship."