A Generational Growth Story: Sweetgreen, Inc.
- December 21, 2021
Initiate At Outperform
Oppenheimer analysts believe Sweetgreen represents a unique opportunity to own a generational growth story at the intersection of powerful shifts in consumer trends. Sweetgreen's industry leading unit economics and unique competitive advantages enable our analysts' thesis that Sweetgreen can ultimately operate thousands of units, versus only ~140 today.
Their deep-dive analysis validates a clear path to 1,000+ units over the next decade (vs. 140 today), enabling a >20% unit growth CAGR. With attractive new unit economics and strengthening same-store-sales, our analysts forecast a robust inflection in profitability metrics as the business scales.
Sweetgreen's founders positioned the brand to rewrite the future of fast food and benefit from shifts in digital adoption and healthier eating. Since its infancy, digital has been a strategic priority and represents ~68% of sales with subscription-like customer frequency. Separately, its differentiated menu and supply chain help Sweetgteen capture organic food tailwinds, which has grown 3x faster than overall food.
Oppenheimer analysts initiate coverage with an Outperform rating and $41 price target.