Two Growth Stocks to Watch Amid Market Corrections

Investors should consider Upstart and Sweetgreen, as market corrections have prompted lower stock prices. Upstart shows promising growth with improved profitability, while Sweetgreen presents potential through its innovative technology and future expansion plans.

Date: 24-03-2025

AI Rating: 7

Impact of Earnings and Revenue Growth

Upstart has shown notable improvements in its financials. The company reported fourth-quarter revenue growth of 56%, totaling $219 million, alongside a leap in adjusted earnings per share, recovering from a loss to gain $0.29. This development is a strong indicator of profitability return, suggesting that the stock may appeal to investors looking for turnaround stories.

Moreover, Upstart forecasts over $1 billion in revenue for 2025, signifying a revenue growth of at least 58%. This ambitious outlook, combined with a significant increase in loans originated (up 68%), demonstrates the company’s potential rebound and underscores a positive trend that may boost its stock price significantly over time.

On the other hand, Sweetgreen's financial performance was mixed. With a modest revenue increase of 5% to $160.9 million and same-store sales growth of 4%, concerns arose after the company guided for a same-store sales decline in the first quarter. However, Sweetgreen aims for a full-year same-store sales growth of 1%-3% and expects an improvement in restaurant-level profit margins from 17% to 19.8%-20.5%. This upward trend in profit margins, paired with the ambitious plan to open 40 new restaurants, could position Sweetgreen for significant growth.

Despite current challenges reflected by its stock price dropping nearly 50% from its peak, the potential for Sweetgreen to leverage its innovative initiatives like the Infinite Kitchen may create favorable conditions for future stock recovery.

Stocks: NASDAQ:UPST NYSE:SG