Sweetgreen stock is ‘a recipe for portfolio destruction’
CNBC’s Jim Cramer on Tuesday warned investors not to invest in Sweetgreen, saying the stock is unlikely to perform well in an inflationary environment.
“This is a bear market, not a bull market. … In a bear market, you do not stick your neck out to pick at hated stocks,” he said.
“Right now, Wall Street loves earnings, cash flow, dividends. Sweetgreen’s got none of these things. You’re fighting the [Federal Reserve] and the tape if you try to bottom fish in this one, and that’s a recipe for portfolio destruction,” the “Mad Money” host added.
Cramer didn’t mince words when laying out why he believes the company’s stock is uninvestable. He reminded viewers the company’s pricey salads are unlikely to sell in an inflationary environment.
The possibility of a recession or a new Covid-19 variant also makes him wary of the stock, he added.
“Sweetgreen’s an unprofitable growth story. …. I told you to avoid this stock when it came public. Told you again to avoid it in December, when it was trading at $33. Nothing that’s happened in the last six months has made me change my mind,” Cramer said.
Shares of Sweetgreen fell 2.3% to $11.86 on Tuesday.
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