CAVA Group (NYSE:CAVA) Stock Price Down 3.7% on Analyst Downgrade

Key Points

• CAVA shares fell 3.7% to about $55.33 after TD Cowen cut its price target from $85 to $78, while maintaining a Buy rating.
• Analyst sentiment remains broadly positive, with an overall “Moderate Buy” rating and an average price target of $88.62, despite several recent target reductions.
• CAVA reported quarterly revenue growth of 31.3% and earnings above estimates, while its board authorized a $100 million stock buyback covering up to 1.7% of outstanding shares.

CAVA Group, Inc. (NYSE:CAVA - Get Free Report) shares dropped 3.7% during mid-day trading on Wednesday after TD Cowen lowered their price target on the stock from $85.00 to $78.00. TD Cowen currently has a buy rating on the stock. CAVA Group traded as low as $55.50 and last traded at $55.3280. 121,047 shares were traded during trading, a decline of 96% from the average session volume of 3,355,209 shares. The stock had previously closed at $57.45.

A number of other research analysts also recently weighed in on the company. Compass Point raised CAVA Group to a "neutral" rating in a research note on Monday, September 14th. Melius Research raised CAVA Group from a "hold" rating to a "buy" rating and set a $95.00 target price for the company in a research report on Thursday, October 8th. DA Davidson decreased their target price on CAVA Group from $84.00 to $75.00 and set a "neutral" rating for the company in a research report on Thursday, August 13th. Citigroup reiterated a "buy" rating on shares of CAVA Group in a report on Tuesday, July 28th. Finally, Roth Capital reissued a "buy" rating and issued a $95.00 price target (down from $106.00) on shares of CAVA Group in a research report on Wednesday, August 12th. One research analyst has rated the stock with a Strong Buy rating, seventeen have assigned a Buy rating and ten have assigned a Hold rating to the company. According to MarketBeat, the company currently has an average rating of "Moderate Buy" and an average price target of $88.62.

Insider Activity at CAVA Group

In other CAVA Group news, insider Douglas Thompson acquired 6,500 shares of the company's stock in a transaction dated Monday, August 31st. The shares were acquired at an average cost of $66.52 per share, for a total transaction of $432,380.00. Following the completion of the purchase, the insider owned 19,371 shares of the company's stock, valued at approximately $1,288,558.92. This trade represents a 50.50% increase in their position. The purchase was disclosed in a filing with the SEC, which is accessible through this hyperlink. Insiders own 6.70% of the company's stock.

Institutional Trading of CAVA Group

Hedge funds have recently added to or reduced their stakes in the business. Counterpoint Mutual Funds LLC raised its holdings in CAVA Group by 38.7% in the 3rd quarter. Counterpoint Mutual Funds LLC now owns 9,703 shares of the company's stock valued at $525,000 after acquiring an additional 2,709 shares in the last quarter. Daytona Street Capital LLC acquired a new stake in shares of CAVA Group during the 3rd quarter worth approximately $178,000. AdvisorNet Financial Inc grew its holdings in shares of CAVA Group by 18.8% during the 3rd quarter. AdvisorNet Financial Inc now owns 5,109 shares of the company's stock worth $264,000 after purchasing an additional 807 shares in the last quarter. Seelaus Asset Management LLC grew its holdings in shares of CAVA Group by 40.5% during the 3rd quarter. Seelaus Asset Management LLC now owns 4,017 shares of the company's stock worth $217,000 after purchasing an additional 1,157 shares in the last quarter. Finally, Generate Investment Management Ltd bought a new stake in shares of CAVA Group during the third quarter valued at approximately $11,221,000. Institutional investors own 73.15% of the company's stock.

CAVA Group Stock Down 3.4%

The firm has a market capitalization of $6.48 billion, a P/E ratio of 100.80, a PEG ratio of 4.48 and a beta of 1.80. The business has a 50-day moving average price of $59.10 and a 200-day moving average price of $71.53.

CAVA Group (NYSE:CAVA - Get Free Report) last issued its earnings results on Tuesday, August 11th. The company reported $0.19 EPS for the quarter, beating analysts' consensus estimates of $0.18 by $0.01. The business had revenue of $368.44 million during the quarter, compared to analyst estimates of $360.09 million. CAVA Group had a return on equity of 8.28% and a net margin of 4.82%. CAVA Group's revenue was up 31.3% on a year-over-year basis. During the same period in the prior year, the company posted $0.16 earnings per share. As a group, sell-side analysts forecast that CAVA Group, Inc. will post 0.55 EPS for the current year.

CAVA Group announced that its Board of Directors has initiated a stock buyback plan on Friday, September 18th that allows the company to buy back $100.00 million in outstanding shares. This repurchase authorization allows the company to repurchase up to 1.7% of its stock through open market purchases. Share repurchase plans are usually an indication that the company's board believes its shares are undervalued.

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.

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