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Warm weather usually drives salad sales, but consumers spooked by the ongoing cyclospora outbreaks are avoiding lettuce this summer.

Traffic to Chopt Creative Salad Co. locations fell 24% on July 18, right after the Food and Drug Administration announced the outbreak, according to Placer.ai data. Sweetgreen on Thursday said consumer concerns about the outbreak had about a 6 percentage point impact on same-store sales in July, and the company cut its full-year outlook. And earlier this week, upstart chain Salad and Go filed for Chapter 11 bankruptcy and closed all of its locations, saying the cyclospora outbreak had exacerbated its existing business challenges.

Grocery stores aren't immune either. Dollar sales of prepackaged salads plunged 14% during the four weeks ended July 25 compared with the year-ago period, according to NielsenIQ data.

The FDA has pointed to iceberg lettuce processed in Taylor Farms' central Mexico facility as the likely culprit for the outbreak that has sickened at least 10,000 people. Taylor Farms has voluntarily recalled products supplied from that facility.

Yum Brands' Taco Bell is the only national restaurant chain that has been linked to the multistate outbreak. It uses iceberg lettuce frequently across its menu, from its Crunchwrap Supreme to its Cheesy Gordita Crunches, but the chain isn't known for its salads. Taco Bell's sales and traffic to its restaurants initially tumbled after the FDA announcement, but Yum executives said in late July that business was already recovering.

But the FDA is also tracking at least six other active outbreaks without a clear culprit; those outbreaks have significantly smaller number of reported cases. The long incubation period for cyclosporiasis makes it difficult to identify the contaminated ingredients.

Cyclospora is a water-borne parasite. It typically spreads through contaminated produce, like lettuce, green onions, raspberries and fresh herbs. Although public health authorities seem to have pinpointed the source of the current outbreak, the FDA is advising consumers to take extra steps, like discarding outer layers of fruits and vegetables, to reduce risk of exposure.

Read more cyclospora newsCyclospora outbreak has hurt Taco Bell but sales are already improving, Yum Brands CEO saysConsolidated food supply may be worsening cyclospora outbreaks, experts sayMichigan confirms first two deaths in cyclospora outbreakSalad and Go files for Chapter 11 bankruptcy after cyclospora fears worsened its challengesSweetgreen cuts full-year outlook as cyclospora fears weigh on salesBut many diners have gone further and chosen to avoid salads and greens altogether during the outbreak.

Even Chipotle Mexican Grill has seen its sales dip. The burrito chain offers romaine lettuce as a topping and uses fresh cilantro across much of its menu, including its guacamole and salsas.

"In the second half of July, we did see a softening, call it about 200 basis points or so, right around the issue that's affecting the industry around cyclospora," Chipotle CFO Adam Rymer said on the company's earnings call in late July.

Chipotle has separately been in the news for recalling jalapeno peppers that were potentially contaminated with salmonella as part of a broader outbreak that has sickened at least 300 people.

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Damage controlSweetgreen and other restaurant chains swept up in the panic have had to implement strategies to reassure their customers.

For example, Sweetgreen has chosen to emphasize that iceberg lettuce isn't even on its menu. On the chain's 19th birthday, CEO Jonathan Neman posted on X that its restaurants have never served iceberg lettuce and only source lettuce grown in the U.S.

Likewise, Just Salad founder and CEO Nick Kenner posted on LinkedIn detailing the chain's food safety measures, like peeling and discarding the outer leaves of romaine and kale and double washing the leaves.

And Chopt posted on its Instagram about food safety.

"Food safety has always been at the heart of how we operate. ... We promise to continue monitoring guidance from public health officials and remain committed to earning your trust every time you choose Chopt," the company wrote.

Cava, another fast-casual chain known for its bowls and salads, has yet to report its earnings and any impact from the cyclospora scare. It is expected to share its quarterly results after the bell on Tuesday.

But in a promising sign for many restaurant chains — and diners — the danger may be passing.

The Michigan Health Department on Thursday said residents can eat lettuce and salad greens again as new infections slowed.

"The broad, precautionary recommendation to avoid bagged salad mixes during the Cyclospora outbreak is no longer in effect," the agency said in a statement. "Residents may resume their usual food handling practices and make choices based on their individual risk tolerance."

The state appears to be hardest hit by the outbreak, with two deaths and more than 12,400 cases reported in Michigan alone.

Of course, not all consumers have lost their appetite for greens. A Sweetgreen location in downtown Manhattan was bustling with diners and delivery drivers around noon on Friday.

Sherine Naveed, a 35-year-old laser technician who lives on Long Island, picked up her usual Sweetgreen salad order. Despite hearing about the outbreak, she hasn't changed her dining habits and is also still buying prepackaged salads at the grocery store.

"I have two kids," she said. "They're already pretty germ-y."

Sweetgreen, Inc. (SG - Free Report) came out with a quarterly loss of $0.22 per share versus the Zacks Consensus Estimate of a loss of $0.13. This compares to a loss of $0.2 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents an earnings surprise of -69.23%. A quarter ago, it was expected that this company would post a loss of $0.23 per share when it actually produced a loss of $0.27, delivering a surprise of -17.39%.

Over the last four quarters, the company has not been able to surpass consensus EPS estimates.

Sweetgreen, which belongs to the Zacks Retail - Restaurants industry, posted revenues of $192.66 million for the quarter ended June 2026, missing the Zacks Consensus Estimate by 0.05%. This compares to year-ago revenues of $185.58 million. The company has not been able to beat consensus revenue estimates over the last four quarters.

The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.

Sweetgreen shares have lost about 9.8% since the beginning of the year versus the S&P 500's gain of 12.8%.

What's Next for Sweetgreen?While Sweetgreen has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?

There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.

Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Ahead of this earnings release, the estimate revisions trend for Sweetgreen was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is -$0.16 on $183.68 million in revenues for the coming quarter and $0.64 on $705.42 million in revenues for the current fiscal year.

Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Retail - Restaurants is currently in the bottom 22% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

Arcos Dorados (ARCO - Free Report) , another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on August 13.

This restaurant owner is expected to post quarterly earnings of $0.15 per share in its upcoming report, which represents a year-over-year change of +36.4%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days.

Arcos Dorados' revenues are expected to be $1.28 billion, up 12.1% from the year-ago quarter.

Sweetgreen stock jumped 15% Friday, paring back a massive four-day slump, after regulators traced an explosive diarrhea outbreak back to Taco Bell restaurants – sparing the salad bowl chain’s reputation.

The fast-casual salad chain – known for its so-called “slop bowls” – saw its stock soar as much as 21% Friday for its biggest intraday gain since August 2024.

It plummeted nearly 26% from Monday through Thursday’s close as investors feared consumers would steer clear of fresh produce as thousands of people across several US states were sickened by cyclosporiasis.

Sweetgreen – known for its so-called “slop bowls” – saw its stock soar as much as 21% Friday. Boston Globe via Getty Images The Centers for Disease Control and Prevention and the Food and Drug Administration said late Thursday that they had linked the outbreak to shredded iceberg lettuce served at a handful of Taco Bell restaurants in Indiana, Kentucky, Michigan, Ohio and West Virginia.

On Friday, Bloomberg reported that Taylor Farms, a California-based fresh produce supplier, is preparing to recall ingredients linked to the outbreak.

“Sweetgreen does not use iceberg lettuce in our menu,” a spokesperson for Sweetgreen said in a statement. 

“From the outset of the investigation, we have been in close contact with our suppliers to determine whether any ingredients in our supply chain have been identified as part of the investigation. To date, none have been.”

Shares of Sweetgreen are still down nearly 15% this week, while Taco Bell has fallen about roughly 8% during the same timeframe – similarly regaining some losses after the fast-food giant said it has removed lettuce from the tainted supplier nationwide.

The FDA said it was able to link the outbreak to the burrito-and-taco chain after more than 1,644 sick people suffering from cyclosporiasis reported eating at Taco Bell locations in five states.

Shares of Sweetgreen are still down nearly 15% this week. Ai – stock.adobe.com Regulators said they are working directly with the unnamed supplier – now reportedly believed to be Taylor Farms – to determine if the contaminated iceberg lettuce was sent to any other partners.

Cyclospora is a microscopic parasite that is typically transmitted when infected feces contaminates food or water, according to the FDA.

It can cause an intestinal illness called cyclosporiasis, characterized by symptoms like watery diarrhea, loss of appetite, weight loss, stomach cramps or pain, bloating, gas, nausea and fatigue, according to food safety regulators. Some people may become infected and be asymptomatic.

The main risk from cyclosporiasis is dehydration that can lead to more serious complications. Those most at risk include people with weakened immune systems, the elderly and children.

Sweetgreen Today

SG

Sweetgreen

$8.71 +0.42 (+5.04%)

As of 11:07 AM Eastern

This is a fair market value price provided by Massive. Learn more.

52-Week Range$4.49▼

$16.70P/E Ratio72.26

Price Target$8.04

Shares of Sweetgreen Inc. NYSE: SG have surged 60% over the past three months, rebounding from a steep selloff that began in late 2024 as concerns about slowing consumer demand mounted. The rally has some questioning whether the company's efforts to revive the business are finally gaining traction or if the stock is simply rebounding from deeply oversold levels.

Sweetgreen's core business remains unprofitable, and the company has missed Wall Street expectations more often than not since going public, including the most recent quarter, reported on May 8.

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However, encouraging comments about its turnaround efforts seem to have sparked fresh optimism.

Sweetgreen Shares Have Surged Since Hitting March LowThe fast-casual chain, known for its salads and other healthy menu items, went public in late 2021, and its shares initially soared. However, the gains were short-lived, and the stock spent much of the next few years under pressure as the company struggled to turn a profit.

In 2024, things started to look up. The stock went from trading around $10 in January to above $44 by November. But as concerns about slowing consumer demand emerged, those gains quickly unraveled. By March 2026, the stock had plunged to an all-time low of $4.49. Since then, shares have rebounded sharply, surging nearly 100%.

The catalyst doesn't appear to be the company's most recent earnings report. Sweetgreen posted a first-quarter loss of 27 cents per share, wider than the 21-cent-per-share loss reported a year earlier and Wall Street's estimate for a 23-cent loss. Revenue of roughly $162 million fell nearly 3% year over year and missed expectations by about $2 million. The results marked the company's fourth consecutive earnings and revenue miss and its third straight quarter of declining revenue.

Turnaround Plan Is Showing Signs of TractionDespite the disappointing earnings report, the company's comments on its Sweetgrowth Transformation Plan, launched in November 2025 to help turn the business around, appeared to spark optimism among investors.

During the earnings call, co-founder and Chief Executive Jonathan Neman said, "We are beginning to see signs that the actions we are putting in place are gaining traction. We are seeing improvement in execution across our restaurants, greater consistency in the guest experience, and stronger alignment across our teams."

He added, "We saw improvement as the quarter progressed with a further step up in April."

Neman also expressed enthusiasm about the recent addition of wraps to the menu, which he described as Sweetgreen's "most significant menu expansion in several years." The company expects wraps to help drive traffic while making the brand more accessible because of its lower price point.

Sentiment Has Improved, But Wall Street Remains CautiousInvestors appeared encouraged by the company's comments about improving trends. In the weeks following the report, five analysts raised their price targets on the stock, while two upgraded their ratings.

Even with the recent upgrades, Wall Street remains somewhat cautious. The consensus rating on Sweetgreen is Hold, based on 12 Hold ratings, four Buys, and three Sells. The majority of analysts aren't anticipating upside over the next year. The average 12-month price target of just above $8 is roughly 5% below the current share price. Price targets range from a low of $4.50 to a high of $15.

There are other indicators that suggest sentiment may be improving as well. The number of shares sold short has fallen from roughly 25 million, or nearly 27% of float, at the end of March to less than 20 million, or roughly 20% of float, as of the most recent reporting period at the end of May. While the stock remains heavily shorted, some bearish investors appear to be backing away from the name.

Insiders also appear to be expressing confidence in the company. Over the past three months, Sweetgreen insiders purchased roughly $3.4 million worth of company stock. No insider sales were reported.

Despite Recent Rally, Stock Remains Well Below HighsEven after the recent rally, Sweetgreen shares are still trading around $9, well below their July 52-week high of $16.70 and far below the more than $44 level reached in November 2024.

The stock's steep decline has left Sweetgreen trading at a discount to several peers in the fast-casual restaurant sector, which could help explain the renewed interest in the shares.

On a price-to-sales basis, Sweetgreen stock trades at less than 1.6X sales, compared with roughly 8.3X for CAVA Group Inc. NYSE: CAVA, 3.4X for Chipotle Mexican Grill, Inc. NYSE: CMG, and 6.1X for Wingstop Inc. NASDAQ: WING. Shake Shack Inc. NYSE: SHAK, which plummeted after reporting disappointing Q1 results, is the closest comparison, trading at 1.7X sales.

Sweetgreen's rebound likely began as investors saw value in a stock that had been heavily sold off. More recently, however, signs of progress in the company's turnaround efforts appear to have provided additional support for the rally.

Sweetgreen, Inc. (SG) Price Chart for Wednesday, June, 24, 2026

While the company's financial results still leave plenty of room for improvement, investors seem increasingly focused on what comes next. The second-quarter earnings report in August should provide a clearer indication of whether the recent improvement in traffic trends continued and whether Sweetgreen is beginning to translate those gains into stronger financial performance.

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