Sweetgreen (SG) Q3 Earnings Report Preview: What To Look For

Casual salad chain Sweetgreen (NYSE:SG) will be reporting results tomorrow after market close. Here’s what to look for.

Sweetgreen beat analysts’ revenue expectations by 2.1% last quarter, reporting revenues of $184.6 million, up 21.1% year on year. It was a satisfactory quarter for the company, with an impressive beat of analysts’ EBITDA estimates but a miss of analysts’ earnings estimates.

Is Sweetgreen a buy or sell going into earnings? Read our full analysis here, it’s free.

This quarter, analysts are expecting Sweetgreen’s revenue to grow 14.4% year on year to $175.5 million, slowing from the 23.7% increase it recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.11 per share.

Heading into earnings, analysts covering the company have grown increasingly bearish with revenue estimates seeing 4 downward revisions over the last 30 days (we track 10 analysts). Sweetgreen has missed Wall Street’s revenue estimates five times over the last two years.

Looking at Sweetgreen’s peers in the modern fast food segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Shake Shack delivered year-on-year revenue growth of 14.7%, meeting analysts’ expectations, and Chipotle reported revenues up 13%, in line with consensus estimates. Shake Shack traded up 7% following the results while Chipotle was down 7.8%.

Read our full analysis of Shake Shack’s results here and Chipotle’s results here.

There has been positive sentiment among investors in the modern fast food segment, with share prices up 6.8% on average over the last month. Sweetgreen is up 2.6% during the same time and is heading into earnings with an average analyst price target of $39.40 (compared to the current share price of $39.21).

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