Sweetgreen Stock Sell-Off: Should You Buy the Dip?

Sweetgreen (NYSE: SG), a fast-casual restaurant specializing in salads and grain bowls, attracted a lot of attention when it went public on Nov. 18, 2021. Its stock surged from its IPO price of $28 to $52 on its opening trade, and it closed at its record high of $53 a day later.

At the time, the bulls were impressed by Sweetgreen's strong same-store sales growth and ambitious expansion plans, and it was frequently called the "next (NYSE: CMG)." The buying frenzy in growth stocks further amplified its gains and inflated its valuations.

But today, Sweetgreen's stock trades at about $8. Its valuations wilted as its same-store sales growth cooled off, inflation boosted its labor and commodity costs, and it faced tougher competitors. Should investors buy the dip and expect a recovery over the next 12 months?

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Source Fool.com