Sweetgreen (NYSE:SG – Get Free Report) and Potbelly (NASDAQ:PBPB – Get Free Report) are both retail/wholesale companies, but which is the superior business? We will compare the two companies based on the strength of their valuation, dividends, risk, institutional ownership, earnings, profitability and analyst recommendations.
Risk and Volatility
Sweetgreen has a beta of 2.32, indicating that its stock price is 132% more volatile than the S&P 500. Comparatively, Potbelly has a beta of 1.18, indicating that its stock price is 18% more volatile than the S&P 500.
Profitability
This table compares Sweetgreen and Potbelly’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Sweetgreen | -14.33% | -19.34% | -10.82% |
| Potbelly | 7.58% | 21.42% | 1.85% |
Valuation and Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Sweetgreen | $584.04 million | 7.03 | -$113.38 million | ($0.93) | -38.66 |
| Potbelly | $491.41 million | 0.51 | $5.12 million | $0.12 | 70.00 |
Potbelly has lower revenue, but higher earnings than Sweetgreen. Sweetgreen is trading at a lower price-to-earnings ratio than Potbelly, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
95.8% of Sweetgreen shares are held by institutional investors. Comparatively, 72.6% of Potbelly shares are held by institutional investors. 21.5% of Sweetgreen shares are held by company insiders. Comparatively, 9.1% of Potbelly shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Analyst Recommendations
This is a breakdown of current recommendations for Sweetgreen and Potbelly, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Sweetgreen | 0 | 3 | 8 | 0 | 2.73 |
| Potbelly | 0 | 1 | 3 | 0 | 2.75 |
Sweetgreen currently has a consensus price target of $38.20, suggesting a potential upside of 6.26%. Potbelly has a consensus price target of $14.33, suggesting a potential upside of 70.63%. Given Potbelly’s stronger consensus rating and higher probable upside, analysts plainly believe Potbelly is more favorable than Sweetgreen.
Summary
Potbelly beats Sweetgreen on 8 of the 14 factors compared between the two stocks.
About Sweetgreen
Sweetgreen, Inc., together with its subsidiaries, operates fast food restaurants serving healthy foods at scale in the United States. The company also accepts orders through its online and mobile ordering platforms, as well as sells gift cards that do not have an expiration date and can be redeemed. The company was founded in 2006 and is headquartered in Los Angeles, California.
About Potbelly
Potbelly Corporation, through its subsidiaries, owns, operates, and franchises Potbelly sandwich shops in the United States. The company was formerly known as Potbelly Sandwich Works, Inc. and changed its name to Potbelly Corporation in 2002. Potbelly Corporation was founded in 1977 and is headquartered in Chicago, Illinois.
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