Sweetgreen (Sweetgreen) ROC % : -17.74% (As of Dec. 2023)

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What is Sweetgreen ROC %?

ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Sweetgreen's annualized return on capital (ROC %) for the quarter that ended in Dec. 2023 was -17.74%.

As of today (2024-05-01), Sweetgreen's WACC % is 9.55%. Sweetgreen's ROC % is -18.65% (calculated using TTM income statement data). Sweetgreen earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Sweetgreen ROC % Historical Data

The historical data trend for Sweetgreen's ROC % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Sweetgreen ROC % Chart

Sweetgreen Annual Data

Trend

Dec19

Dec20

Dec21

Dec22

Dec23

ROC %

-53.49

-95.82

-60.68

-41.11

-18.71

Sweetgreen Quarterly Data
	Dec19	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
ROC %	Get a 7-Day Free Trial										-42.81	-23.08	-17.26	-16.52	-17.74

Sweetgreen ROC % Calculation

Sweetgreen's annualized Return on Capital (ROC %) for the fiscal year that ended in Dec. 2023 is calculated as:

	ROC % (A: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (A: Dec. 2022 )	+	Invested Capital (A: Dec. 2023 ))	/ count )
=	-113.596 * ( 1 - -0.34% )	/	( (596.172	+	621.999)	/ 2 )
=	-113.9822264	/	609.0855
=	-18.71 %

where

	Invested Capital		(A: Dec. 2022 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	908.935	-	39.163	-	( 331.614	-	max(0, 72.549	-	346.149	+	331.614	))
=	596.172

	Invested Capital		(A: Dec. 2023 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	856.557	-	50.026	-	( 257.23	-	max(0, 91.579	-	276.111	+	257.23	))
=	621.999

Sweetgreen's annualized Return on Capital (ROC %) for the quarter that ended in Dec. 2023 is calculated as:

	ROC % (Q: Dec. 2023 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2023 )	+	Invested Capital (Q: Dec. 2023 ))	/ count )
=	-112.06 * ( 1 - 2.05% )	/	( (615.137	+	621.999)	/ 2 )
=	-109.76277	/	618.568
=	-17.74 %

where

	Invested Capital		(Q: Sep. 2023 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	879.855	-	47.109	-	( 274.743	-	max(0, 81.053	-	298.662	+	274.743	))
=	615.137

	Invested Capital		(Q: Dec. 2023 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	856.557	-	50.026	-	( 257.23	-	max(0, 91.579	-	276.111	+	257.23	))
=	621.999

Note: The Operating Income data used here is four times the quarterly (Dec. 2023) data.

Sweetgreen (NYSE:SG) ROC % Explanation

ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. The reason book values of debt and equity are used is because the book values are the capital the company received when issuing the debt or receiving the equity investments.

There are four key components to this definition. The first is the use of operating income or EBIT rather than net income in the numerator. The second is the tax adjustment to this operating income or EBIT, computed as a hypothetical tax based on an effective or marginal tax rate. The third is the use of book values for invested capital, rather than market values. The final is the timing difference; the capital invested is from the end of the prior year whereas the operating income or EBIT is the current year's number.

Why is ROC % important?

Because it costs money to raise capital. A firm that generates higher returns on investment than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.

As of today, Sweetgreen's WACC % is 9.55%. Sweetgreen's ROC % is -18.65% (calculated using TTM income statement data). Sweetgreen earns returns that do not match up to its cost of capital. It will destroy value as it grows.

Be Aware

Like ROE % and ROA %, ROC % is calculated with only 12 months of data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.

Sweetgreen ROC % Related Terms

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Sweetgreen (Sweetgreen) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Restaurants » Sweetgreen Inc (NYSE:SG) » Definitions » ROC %

Comparable Companies

Traded in Other Exchanges

N/A

Address

3102 36th Street, Los Angeles, CA, USA, 90018

Website

https://www.sweetgreen.com

Sweetgreen Inc is a next-generation restaurant and lifestyle brand that serves healthy food at scale. It is creating plant-forward, seasonal, and earth-friendly meals from fresh ingredients and produce that prioritizes organic, regenerative, and local sourcing.

Executives

Jonathan Neman	director, officer: Chief Executive Officer	C/O SWEETGREEN, INC., 3101 W. EXPOSITION BOULEVARD, LOS ANGELES CA 90018
Nicolas Jammet	director, officer: Chief Concept Officer	C/O SWEETGREEN, INC., 3101 W. EXPOSITION BOULEVARD, LOS ANGELES CA 90018
Nathaniel Ru	director, officer: Chief Brand Officer	C/O SWEETGREEN, INC., 3101 W. EXPOSITION BOULEVARD, LOS ANGELES CA 90018
Adrienne Gemperle	officer: Chief People Officer	C/O SWEETGREEN, INC., 3101 W. EXPOSITION BOULEVARD, LOS ANGELES CA 90018
James Mcphail	officer: Chief Development Officer	C/O SWEETGREEN, INC., 3101 W. EXPOSITION BOULEVARD, LOS ANGELES CA 90018
Mitch Reback	officer: Chief Financial Officer	C/O SWEETGREEN, INC., 3101 W. EXPOSITION BOULEVARD, LOS ANGELES CA 90018
Wouleta Ayele	officer: Chief Technology Officer	C/O SWEETGREEN, INC., 3101 W. EXPOSITION BOULEVARD, LOS ANGELES CA 90018
Daniel Shlossman	officer: SVP, Digital and Growth	C/O SWEETGREEN, INC., 3101 W. EXPOSITION BOULEVARD, LOS ANGELES CA 90018
Chris Carr	officer: Chief Operating Officer	7930 JONES BRANCH DRIVE, MCLEAN VA 22102
Clifford Burrows	director	2401 UTAH AVE. S., SUITE 800, SEATTLE WA 98134
Valerie B Jarrett	director	USG CORPORATION, 125 SOUTH FRANKLIN STREET, CHICAGO IL 60606
Julie Bornstein	director	C/O REDFIN CORPORATION, 1099 STEWART STREET, SUITE 600, SEATTLE WA 98101
Bradley E Singer	director	ONE LETTERMAN DRIVE, BUILDING D, 4TH FLOOR, SAN FRANCISCO CA 94129
Youngme E Moon	director	75 NETWORK DRIVE, BURLINGTON MA 01803
Stephen M Case	director	1717 RHODE ISLAND AVENUE, N.W., 9TH FLOOR, WASHINGTON DC 20036