Critical Survey: Sweetgreen (NYSE:SG) and Domino’s Pizza (NASDAQ:DPZ)

Domino’s Pizza (NASDAQ:DPZ) and Sweetgreen (NYSE:SG) are both retail/wholesale companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, profitability, risk, dividends, earnings and valuation.

Institutional and Insider Ownership

94.6% of Domino’s Pizza shares are owned by institutional investors. Comparatively, 95.8% of Sweetgreen shares are owned by institutional investors. 0.8% of Domino’s Pizza shares are owned by company insiders. Comparatively, 19.8% of Sweetgreen shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Domino’s Pizza and Sweetgreen”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Domino’s Pizza	$4.94 billion	2.83	$601.70 million	$17.57	23.66
Sweetgreen	$679.47 million	1.05	-$134.07 million	($1.14)	-5.27

Domino’s Pizza has higher revenue and earnings than Sweetgreen. Sweetgreen is trading at a lower price-to-earnings ratio than Domino’s Pizza, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and target prices for Domino’s Pizza and Sweetgreen, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Domino’s Pizza	2	13	11	2	2.46
Sweetgreen	2	13	3	0	2.06

Domino’s Pizza presently has a consensus target price of $475.71, suggesting a potential upside of 14.41%. Sweetgreen has a consensus target price of $8.22, suggesting a potential upside of 36.91%. Given Sweetgreen’s higher probable upside, analysts plainly believe Sweetgreen is more favorable than Domino’s Pizza.

Volatility and Risk

Domino’s Pizza has a beta of 1.16, suggesting that its share price is 16% more volatile than the S&P 500. Comparatively, Sweetgreen has a beta of 1.93, suggesting that its share price is 93% more volatile than the S&P 500.

Profitability

This table compares Domino’s Pizza and Sweetgreen’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Domino’s Pizza	12.18%	-15.28%	34.06%
Sweetgreen	-19.73%	-32.26%	-15.80%

Summary

Domino’s Pizza beats Sweetgreen on 11 of the 15 factors compared between the two stocks.

About Domino’s Pizza

Domino’s Pizza, Inc., through its subsidiaries, operates as a pizza company in the United States and internationally. The company operates through three segments: U.S. Stores, International Franchise, and Supply Chain. It offers pizzas under the Domino’s brand name through company-owned and franchised stores. It also provides oven-baked sandwiches, pastas, boneless chicken and chicken wings, breads and dips, desserts, and soft drink products, as well as loaded tots and pepperoni stuffed cheesy breads. Domino’s Pizza, Inc. was founded in 1960 and is headquartered in Ann Arbor, Michigan.

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.