Start here if you're new
what it is
Cava sells Mediterranean fast-casual food through 367 U.S. restaurants and a smaller grocery business for dips, spreads, and dressings.
how it gets paid
Last year Cava made $1.2B in revenue. In-store restaurant sales was the main engine at $0.66B, or 55% of sales.
why it's growing
Revenue grew 22.4% last year. For the september period, same-store sales rose just 1.9%, all related to higher prices or favorable mix, and cava is unlikely to have done much.
what just happened
Latest earnings showed revenue of $905M, but EPS landed at $0.04 versus a $0.13 estimate.
At a glance
B+ balance sheet — decent shape, but not bulletproof
108.4x trailing p/e — you're paying up for this one
12.5% return on capital — nothing to write home about
xvary composite: 44/100 — below average
$0.75 fy2027 eps est
What they do
Cava sells Mediterranean fast-casual food through 367 U.S. restaurants and a smaller grocery business for dips, spreads, and dressings.
Cava is winning because it is still opening stores fast and getting more out of old ones. Units rose to 367 from 309 in one year, while same-restaurant sales stayed up 13.4% in 2024. Scale moat (size advantage that lowers costs and lifts brand reach) → more stores, more awareness, better purchasing → so what: you get growth from new boxes and old boxes at the same time.
How they make money
$1.2B
annual revenue · their business grew +22.4% last year
In-store restaurant sales
$0.66B
+13.4%
Digital pickup orders
$0.18B
+22.4%
Delivery marketplace orders
$0.16B
+22.4%
Drive-thru restaurant sales
$0.12B
+22.4%
Grocery dips and dressings
$0.08B
+22.4%
The products that matter
operates and sells food in owned stores
company-operated restaurants
$840M · 70% of revenue
it's the $840M core business, and its +22.4% growth matters more than anything else because the stores are where labor and ingredient pressure hit first.
core engine
licenses brand and collects fees
franchise revenue
$360M · 30% of revenue
this $360M segment adds a lighter-capital layer to the story. if this mix rises over time, margins should improve. right now, you still mostly own restaurants.
margin lever
Key numbers
$0.75
fy2027 eps est
$3B
fy2029 rev est
108.4x
trailing p/e
21.0%
gross margin
Gross profit kept about 21.0% of each revenue dollar.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 3 — safer than 50% of stocks
- price stability 10 / 100
- net profit margin 6.7% — keeps 7 cents of every dollar in revenue
- return on equity 12% — $0.12 profit for every $1 investors have put in
B+ — functional but not a standout on the balance sheet.
Total return vs. market
Return history isn't available for CAVA right now.
source: institutional data · return history unavailable
What just happened
missed estimates
Latest earnings showed revenue of $905M, but EPS landed at $0.04 versus a $0.13 estimate.
Sales were up 210% vs. prior year, but the market cared more about the profit miss. Gross margin was 21.0%, and the latest same-store sales figure of 1.9% says the easy growth phase is cooling.
$255M
revenue
$0.04
eps
21.0%
gross margin
the number that mattered
The 69.23% EPS miss mattered most because a stock at 108.4x earnings gets priced for smooth execution, not surprises.
-
same-store-sales growth has cooled considerably at cava group.double-digit comp gains were the norm during the chain’s first two years as a public company, but building on those increases has been a challenge in recent quarters. these headwinds are hardly unique to cava, as many other restaurant brands, including chipotle, the biggest name in the fast-casual space, have found that customers are visiting their stores less frequently.
-
for the september period, same-store sales rose just 1.9%, all related to higher prices or favorable mix, and cava is unlikely to have done much better than a roughly flat comparison in the recent december interim.
-
we look for earnings to rise about 10% in 2026.profit growth slowed right along with same-store sales last year, and the bottom line is apt to remain under pressure through the 16-week april period.
-
same-store-sales comparisons, though, get much easier after that.
-
cava is also counting on new menu items and other initiatives to lure more customers to its stores.for instance, the company’s first seafood offering, a salmon dish, has been testing well, and management is evaluating a possible rollout in late spring.
source: company earnings report, 2026
Get this snapshot in your inbox
This page, delivered free — plus weekly updates when the numbers change. plain english, no spam.
weekly updates
earnings alerts
plain english
no spam
What could go wrong
the #1 risk is multiple compression if restaurant-level economics stop improving.
high
multiple compression
CAVA trades at 108.4x trailing earnings versus a restaurant peer average of 38.9x and a fair ratio of 29.6x.
the stock is priced for near-flawless execution. it does not need bad news to fall. it just needs less-good news.
high
margin pressure
net margin is 5.5%. that means food costs, labor costs, or promotional pressure can eat into profit quickly.
when you only keep 5.5 cents of every $1 in sales, a small cost miss matters more than it would at a 15% or 20% margin business.
med
growth deceleration
sales grew 22.4% last year. that's the number carrying the valuation story today.
if growth cools before margins expand, investors will stop paying growth-stock prices for restaurant-stock economics.
med
store and menu execution
company-operated restaurants make up 70% of revenue, so operational mistakes do not stay tucked away in a franchise line item.
new menu initiatives can help traffic, but they also test labor, training, and throughput at the store level.
a stock trading at 108.4x earnings with a 5.5% net margin does not need a disaster to rerate — it just needs growth to cool or costs to rise.
source: institutional data · regulatory filings · risk analysis
Pay attention to
metric
sales growth vs. earnings growth
last quarter gave you +20% revenue and -20% EPS. you want that gap closing, not widening.
trend
franchise mix
franchise revenue is 30% of the business today. if that share rises, the model gets lighter and margins should get some help.
risk
insider selling
monitor for further insider sales after a recent $1.5M transaction by a co-founder. one trade is noise. a pattern says more.
calendar
late-spring menu decision
management said the salmon test is being evaluated for a possible late-spring rollout. that's a small menu item with an outsized read-through on traffic and execution.
Analyst rankings
short-term outlook
below average
momentum score 4 — in human-speak, analysts think the stock could lag from here.
risk profile
average
stability score 3 — middle-of-the-pack risk. not a bunker stock, not a pure casino chip either.
chart momentum
below average
technical score 4 — price action is not doing the bull case any favors right now.
source: institutional data
Institutional activity
institutions have been net buying for 3 consecutive quarters — 298 buyers vs. 255 sellers in 3q2025. total institutional holdings: 94.8M shares. net buying for 3 quarters.
source: institutional data
Price targets
3-5 year target range
$49
$125
$60
current price
$87
target midpoint · +46% from current · 3-5yr high: $125 (+110% · 20% ann'l return)
Want the deeper analysis?
The full deep dive: dcf model, scenario analysis, competitive moat breakdown, and quarterly tracking — everything on this page, taken further.
see plans from $5/moThe deep dive