Do You Believe in the Long-Term Growth Prospects of Sweetgreen (SG)?

Meridian Funds, managed by ArrowMark Partners, released its “Meridian Contrarian Fund” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. The U.S. equity market showcased a significant recovery during the quarter, rising 23% from low to end the quarter at a record high. U.S. large-cap stocks gained 11.1% in the quarter, and within the large-cap category, growth stocks outperformed value stocks. In this environment, the fund returned 16.42% (net) during the quarter, exceeding 8.59% returns of the Russell 2500 Index and 7.29% returns of the secondary benchmark, the Russell 2500 Value Index. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second-quarter 2025 investor letter, Meridian Contrarian Fund highlighted stocks such as Sweetgreen, Inc. (NYSE:SG). Sweetgreen, Inc. (NYSE:SG) operates US-based fast-food restaurants serving healthy food and beverages. The one-month return of Sweetgreen, Inc. (NYSE:SG) was -10.22%, and its shares lost 77.27% of their value over the last 52 weeks. On September 25, 2025, Sweetgreen, Inc. (NYSE:SG) stock closed at $8.17 per share, with a market capitalization of $965.791 million.

Meridian Contrarian Fund stated the following regarding Sweetgreen, Inc. (NYSE:SG) in its second quarter 2025 investor letter:

“Sweetgreen, Inc. (NYSE:SG) operates a chain of fast-casual restaurants across the U.S., focused on fresh, healthy food. The company continues to invest in automation through its “Infinite Kitchen” technology, which has demonstrated early promise in reducing labor costs, improving order accuracy, and increasing throughput. While the financial benefits are currently evident in only a small subset of stores, we believe broader adoption will yield meaningful improvements over the next two years. The stock underperformed during the quarter as weak traffic and sales in several core legacy markets (namely Los Angeles, New York City, Washington D.C., and Boston— which all experienced unique exogenous traffic issues) drove negative sales trends overall. We reduced our position during the period but remain optimistic about the long-term value creation potential of the Infinite Kitchen initiative.”

Why Sweetgreen Inc. (SG) Performed Worst On Monday?

Sweetgreen, Inc. (NYSE:SG) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 27 hedge fund portfolios held Sweetgreen, Inc. (NYSE:SG) at the end of the second quarter, same as 27 in the previous quarter. While we acknowledge the risk and potential of Sweetgreen, Inc. (NYSE:SG) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Sweetgreen, Inc. (NYSE:SG) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Sweetgreen, Inc. (NYSE:SG) and shared the list of stocks Jim Cramer discussed. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.