CAVA Group Inc. Common Stock (CAVA)

FairStock Score: 23/100 — RISKY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

At the close on 2026-10-13, CAVA traded at $52.98, giving a $6.2 billion market cap. FairStock calculations show a P/E of 94.61, a P/B of 7.36, and a Graham Number of $9.36, leaving a margin of safety of -466.03%. Those are not bargain numbers. The business itself is growing: in fiscal Q2 2026, the quarter ended 2026-07-12, revenue was $368.4 million, net income $23.0 million, and diluted EPS $0.19. That compares with fiscal Q2 2025, the quarter ended 2025-07-13, when revenue was $280.6 million, net income $18.4 million, and diluted EPS $0.16. Top-line momentum is real. But I see profit quality issues: FY2025, ended 2025-12-28, revenue was $1.2 billion but net income was $63.7 million, down from FY2024, ended 2024-12-29, when net income was $130.3 million. The latest quarter's net margin was only 6.25%. Return on equity is 8.32% and return on capital employed is 3.50%, which tells me the business is not yet generating high returns on the capital it uses. Free cash flow is positive at $49.0 million, but the FCF yield is just 0.8%. The Altman Z-Score of 6.40 and debt-to-equity of 0.62 suggest balance-sheet risk is not acute, while a Piotroski F-Score of 5/9 is middling. The screen calls it a TURNAROUND because it returned to profit after a loss within three years, but the price already assumes a lot of future success. I would want much more evidence of durable margins and cash returns before calling this a value opportunity.

In plain English: CAVA runs Mediterranean fast-casual restaurants and sells dips and spreads in grocery stores. Sales are growing quickly, but profits have slipped and the business earns only a thin margin. At the recent price of $52.98, the stock looks expensive compared with the company's profits and net assets.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-07-12) · fiscal Q1 2026 10-Q (period ended 2026-04-19) · fiscal Q3 2025 10-Q (period ended 2025-10-05) · fiscal Q2 2025 10-Q (period ended 2025-07-13) · FY2025 10-K (period ended 2025-12-28) · FY2024 10-K (period ended 2024-12-29) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer