The Crowd Is Buying Sweetgreen Stock. My Honest Take Isn't as Optimistic.

A lot of people are buying Sweetgreen (NYSE: SG) shares these days. As of June 29, the fast-casual salad chain's stock has gained 90.4% from a deep trough near the end of March. Trading volumes are up in the past three months, short-seller interest is down, and the company's turnaround effort seems to be working.

That's Wall Street's conclusion at the moment, anyway. But I don't agree.

The salad days are over

You see, I think the wheels have come off Sweetgreen's expansion push, and they won't go back on.

The company was hot in 2024. Sales were soaring. Free cash flows were approaching the breakeven point, quarter by quarter. Two years ago, Sweetgreen's stock was up 144% on a 52-week basis.

But that was the peak. The company kept building restaurants, expanding the network from 225 locations in the middle of 2024 to 285 restaurants in Q1 2026. Meanwhile, cash reserves dwindled from $245 million to $157 million. And that includes a $161 million cash boost in Q1 2026 from the sale of Spyce, which developed the robotic Infinite Kitchen technology at the heart of Sweetgreen's expansion plans.

Image source: Getty Images.

Sweetgreen keeps swinging and missing

Sweetgreen isn't out of ideas. The recently introduced wraps might spark consumer interest in this chain, and create-your-own bowls and salads could appeal to price-sensitive customers. And same-store sales have nowhere to go but up after cratering 12.8% year over year in Q1 2026.

However, Sweetgreen has tried new food items and operating models before, with downright disastrous results. Ripple fries went off the menu less than six months after their introduction in March 2025. I already mentioned the Spyce robotic food service idea, which alienated people more than it saved operating costs.

The wraps are on brand, and a slower expansion rate could work better. But ultimately, it's too easy to find similar menu items at lower prices from world-class competitors such as Cava (NYSE: CAVA) and Chipotle Mexican Grill (NYSE: CMG). In particular, Sweetgreen's wraps look like a tough sell next to Chipotle's popular burritos.

Let the crowd have this one. I'm not buying Sweetgreen stock until the turnaround gets some real traction.

Anders Bylund has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Cava Group and Chipotle Mexican Grill. The Motley Fool recommends Sweetgreen and recommends the following options: short June 2026 $36 calls on Chipotle Mexican Grill. The Motley Fool has a disclosure policy.