CAVA Group (NYSE:CAVA) Posts Quarterly Earnings Results, Misses Estimates By $0.01 EPS

CAVA Group (NYSE:CAVA) posted its quarterly earnings results on Wednesday. The company reported $0.11 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.12 by ($0.01), FiscalAI reports. CAVA Group had a return on equity of 8.28% and a net margin of 4.82%. The company had revenue of $356.44 million during the quarter, compared to the consensus estimate of $358.40 million. During the same quarter in the prior year, the business earned $0.12 earnings per share. The firm’s revenue for the quarter was up 21.0% on a year-over-year basis.

Here are the key takeaways from CAVA Group’s conference call:

• CAVA revenue rose 22.1% to $353.7 million, while same-restaurant sales increased 3.1% with slightly positive traffic. Management estimated produce-related concerns weighed on quarterly comps by 150 basis points and said sales strengthened as those concerns eased.
• The company ended the quarter with 500 restaurants, after opening 24 net new locations, and said new restaurants continued to reach approximately 100% productivity. For 2027, management expects at least 16% unit-count growth, supported by a healthy real estate pipeline.
• CAVA raised its full-year outlook to 76–78 new restaurant openings, 6%–7% same-restaurant sales growth, and $184–$189 million in Adjusted EBITDA. Management said the midpoint of its sales range represents its highest-probability expectation.
• Restaurant-level profit margin fell to 23.4% from 24.6%, pressured by wage and labor investments, a higher mix of third-party delivery, and repairs and maintenance. Net income also declined to $13.2 million from $14.7 million; CAVA expects food costs as a percentage of revenue to rise in Q4, partly due to fuel surcharges and pre-marinated chicken.

CAVA Group Trading Up 2.4%

Shares of CAVA stock traded up $1.46 on Wednesday, hitting $61.77. The stock had a trading volume of 7,238,987 shares, compared to its average volume of 2,900,398. CAVA Group has a twelve month low of $43.41 and a twelve month high of $98.79. The company has a fifty day moving average price of $56.05 and a two-hundred day moving average price of $71.20. The firm has a market cap of $7.22 billion, a P/E ratio of 109.65, a PEG ratio of 4.81 and a beta of 1.75.

CAVA Group declared that its Board of Directors has initiated a stock repurchase plan on Friday, September 18th that permits the company to repurchase $100 million in outstanding shares. This repurchase authorization permits the company to purchase up to 1.7% of its stock through open market purchases. Share repurchase plans are typically a sign that the company’s leadership believes its stock is undervalued.

Insider Buying and Selling

In other CAVA Group news, insider Douglas Thompson acquired 6,500 shares of the company’s stock in a transaction that occurred on Monday, August 31st. The shares were acquired at an average price of $66.52 per share, with a total value of $432,380.00. Following the purchase, the insider owned 19,371 shares of the company’s stock, valued at $1,288,558.92. This represents a 50.50% increase in their position. The purchase was disclosed in a filing with the Securities & Exchange Commission, which is available at this link. Insiders own 6.70% of the company’s stock.

Analyst Upgrades and Downgrades

CAVA has been the topic of several analyst reports. Northcoast Research raised CAVA Group from a “sell” rating to a “neutral” rating in a research note on Thursday, August 13th. Weiss Ratings upgraded CAVA Group from a “hold (c-)” rating to a “hold (c)” rating in a report on Thursday, October 8th. Robert W. Baird upgraded CAVA Group to a “strong-buy” rating in a research report on Monday, August 24th. Sanford C. Bernstein reaffirmed an “outperform” rating on shares of CAVA Group in a research note on Wednesday, August 12th. Finally, Wolfe Research upped their price target on CAVA Group from $79.00 to $82.00 and gave the company an “outperform” rating in a research note on Wednesday, August 12th. One analyst has rated the stock with a Strong Buy rating, seventeen have given a Buy rating and ten have given a Hold rating to the company’s stock. Based on data from MarketBeat.com, CAVA Group currently has a consensus rating of “Moderate Buy” and an average price target of $86.81.

CAVA Group Company Profile

CAVA Group, Inc operates CAVA, a fast-casual restaurant brand serving Mediterranean-inspired food in the United States. Its menu includes customizable bowls and pitas, salads, dips, spreads, grilled proteins, and other Mediterranean dishes, with options designed to accommodate a range of dietary preferences.

The company’s restaurants generally use an assembly-line format that allows customers to build meals from a selection of ingredients and sauces. CAVA also offers its branded dips, spreads, and other products through select grocery and retail channels, extending the brand beyond its restaurant locations.

CAVA was founded in 2010 by Dimitri Moshovitis, Ike Grigoropoulos, and Ted Xenohristos.