Sweetgreen (NYSE: SG) shares plunged 6.98% in pre-market trading as UBS downgrades to Neutral citing operational headwinds and leadership changes.

Sweetgreen (NYSE: SG) shares plunged 6.9832% in pre-market trading on Jan. 27, 2026, amid renewed analyst skepticism and operational headwinds.

The selloff followed UBS downgrading the stock to “Neutral” from “Buy,” marking the second major rating cut in a month after Wells Fargo’s earlier move. Analysts cited concerns over the chain’s declining same-store sales for three consecutive quarters in 2025 and its scaled-back expansion plans, which now target 15–20 new locations instead of 37 previously. Leadership instability, including the recent departure of Chief Development Officer Chris Tarrant and co-founder Nathaniel Ru’s retirement, further fueled investor caution.

Market reactions have been volatile, with Sweetgreen’s stock experiencing over 54 price swings of more than 5% in the past year. The current price of $6.69 represents an 80.1% drop from its 52-week high of $33.71 and a 3.4% decline year-to-date. Morgan Stanley’s recent price target reduction to $9.00 from $10.00 compounded pressure on the stock, reflecting broader doubts about the company’s ability to regain growth momentum.

Investors remain wary of Sweetgreen’s long-term value proposition, as the restaurant’s shift toward cost-cutting and menu simplification raises questions about its ability to maintain brand appeal. While the company continues to highlight its ESG initiatives and health-focused cuisine as competitive advantages, these intangible benefits have yet to translate into consistent financial performance or investor confidence.

The market will likely continue to monitor key catalysts, such as the next quarterly earnings report and the success of new store openings, for signs that Sweetgreen can stabilize its operations and rebuild its growth narrative.