CAVA Group, Inc. (CAVA) AI Stock Analysis

• Market Cap: $7.65B
• Dividend Yield: N/A
• Average Volume (3M): 5.30M
• Price to Earnings (P/E): 55.6
• Beta (1Y): 2.03
• Revenue Growth: 28.21%
• EPS Growth: 227.11%
• Country: US
• Employees: 10,300
• Sector: Consumer Cyclical
• Sector Strength: 83
• Industry: Restaurants
• EPS (TTM): 0.16
• Shares Outstanding: 115,954,290
• 10 Day Avg. Volume: 3,492,791
• 30 Day Avg. Volume: 5,298,721
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.43
• Enterprise Value/Revenue: 10.56
• Enterprise Value/Gross Profit: 35.42
• Enterprise Value/Ebitda: 82.92
• 1Y Price Target: $93.67
• Price Target Upside: 42.01% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 16

• Rating: 67 Neutral
• Price Target: $76.00 ▲(15.22% Upside)

CAVA Group, Inc. achieves a solid overall stock score of 67, primarily driven by strong financial performance and positive earnings call insights. The company's robust revenue growth and strategic expansion plans are significant strengths. However, technical analysis indicates bearish momentum, and the high P/E ratio suggests potential overvaluation risks. Investors should weigh these factors, considering both the growth potential and current market conditions.

Positive Factors

Financial Performance

Margins were good, new store performance looks very strong, and other cost lines are controlled well, resulting in an EBITDA beat.

Growth Potential

Unit openings are higher, and nothing else is really off track, indicating strong growth potential.

Investor Sentiment

Poll results suggest investors are positively disposed.

Negative Factors

Growth Multiple Compression

Growth multiple compression has led to a lower price objective.

Guidance and Forecasts

The first-time lowering of same store sales guidance since the 2023 IPO is a significant consideration for investors.

Stock Price Pressure

The stock was not priced for a larger comp miss and FY SSS cut, which is what occurred, leading to expected pressure on the stock.

CAVA Group, Inc. Business Overview & Revenue Model

Company Description

CAVA Group, Inc. (CAVA) is a leading player in the fast-casual dining sector, specializing in Mediterranean cuisine. Founded on the principles of health and wellness, CAVA offers a diverse menu that includes customizable salads, bowls, and pitas, all made with fresh, high-quality ingredients. The company operates a growing number of restaurants across the United States and is known for its commitment to flavor and quality, satisfying the needs of health-conscious consumers.

How the Company Makes Money

CAVA Group, Inc. generates revenue primarily through its chain of fast-casual restaurants, where customers pay for dine-in and take-out meals. The company's revenue model focuses on direct sales of its Mediterranean-inspired menu items, leveraging its ability to create customizable dining experiences that attract a broad customer base. Additionally, CAVA benefits from strategic partnerships with delivery services and has integrated digital ordering platforms to enhance customer convenience and increase sales. The company's emphasis on using fresh, high-quality ingredients allows it to maintain a premium pricing strategy, further contributing to its revenue. Moreover, CAVA's expansion strategy, including new restaurant openings and acquisitions, plays a crucial role in growing its market presence and boosting earnings.

CAVA Group, Inc. Financial Statement Overview

Summary

CAVA Group, Inc. demonstrates strong financial performance with impressive revenue growth and profitability improvements. The balance sheet reflects a healthy equity position but requires careful debt management. Cash flows are robust, supporting continued investments and operations. The company is well-positioned within the restaurant industry, with strong growth trajectories and sound financial health.

Income Statement

CAVA Group, Inc. has demonstrated strong revenue growth, notably a TTM revenue of $1.30 billion, reflecting a significant increase over recent years. Gross profit margin has improved, reaching approximately 22.8% in TTM, indicating effective cost management. Net profit margin is also robust at 12.04%, showing substantial profitability. The company has improved its EBIT and EBITDA margins, reaching 5.25% and 12.36% respectively, suggesting strong operational performance.

Balance Sheet

The balance sheet shows a solid equity position with an equity ratio of 59.12% in TTM, which indicates a strong reliance on equity financing. However, the debt-to-equity ratio has increased to 0.57, suggesting careful monitoring is needed to manage leverage. Return on equity is a strong 21.49%, highlighting effective use of equity in generating profits.

Cash Flow

CAVA exhibits a healthy cash flow profile with positive free cash flow and a free cash flow growth rate of 5.11% in TTM. The operating cash flow to net income ratio stands at 1.28, indicating solid cash generation relative to reported net income. Free cash flow to net income ratio is 0.36, suggesting that while profitable, investments and other cash uses are significant.

Breakdown	TTM	Dec 2024	Dec 2023
Income Statement
Total Revenue	1.04B	963.71M	728.70M
Gross Profit	308.88M	241.81M	180.35M
EBITDA	131.95M	103.79M	78.86M
Net Income	142.03M	130.32M	13.28M
Balance Sheet
Total Assets	1.23B	1.26B	1.06B
Cash, Cash Equivalents and Short-Term Investments	369.27M	366.12M	332.43M
Total Debt	412.49M	378.71M	336.20M
Total Liabilities	502.19M	559.65M	490.02M
Stockholders Equity	726.17M	695.57M	570.80M
Cash Flow
Free Cash Flow	50.90M	52.90M	-41.70M
Operating Cash Flow	161.22M	161.03M	97.10M
Investing Cash Flow	-190.28M	-108.13M	-138.81M
Financing Cash Flow	-10.71M	-19.20M	335.01M

CAVA Group, Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 65.96
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CAVA, the sentiment is Negative. The current price of 65.96 is below the 20-day moving average (MA) of 70.19, below the 50-day MA of 80.22, and below the 200-day MA of 98.23, indicating a bearish trend. The MACD of -4.36 indicates Negative momentum. The RSI at 35.52 is Neutral, neither overbought nor oversold. The STOCH value of 26.21 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CAVA.

CAVA Group, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WING	69 Neutral	$8.62B	53.95	-16.09%	0.36%	22.74%	87.07%
CAKE	68 Neutral	$3.04B	18.80	41.01%	1.77%	4.77%	38.24%
CAVA	67 Neutral	$7.65B	55.56	20.90%	―	28.21%	227.11%
EAT	66 Neutral	$6.94B	19.14	186.74%	―	21.95%	146.44%
SHAK	66 Neutral	$4.35B	219.41	4.16%	―	13.13%	-25.05%
Sector *	61 Neutral	$17.97B	12.87	-5.29%	2.97%	1.26%	-14.45%
SG	46 Neutral	$1.03B	―	-21.95%	―	5.74%	-1.95%

CAVA Group, Inc. Corporate Events

CAVA Group Holds Annual Stockholders Meeting

On June 20, 2025, CAVA Group, Inc. held its annual meeting of stockholders where several key decisions were made. The stockholders approved the election of three Class II directors to the Board, endorsed the executive compensation plan, decided on an annual advisory vote for executive compensation, and ratified Deloitte & Touche LLP as the independent accounting firm for the year ending December 28, 2025.