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Is Cava's stock too expensive? There's no doubt that Cava makes for a great growth stock these days, but the big question is whether the premium investors are paying for it is simply too high. A ...
Cava shares trade at a price-to-sales (P/S) ratio of around 20, which is exceedingly high compared to other world-class restaurant operators such as Chipotle, which also trades at an expensive ...
Although profitable, Cava shares are still very expensive, priced at more than 300 times this year's expected per-share earnings of $0.42 and just under 300 times next year's expected $0.50. The ...
Cava Group's sales are growing by double digits, and it's opening more restaurants. ... the question is whether the stock's rapid increase in price has made it too expensive and put it at too high ...
Cava's restaurant-level profit margins are 26.5%, which should translate to at least 10% to 15% consolidated profit margins when including overhead costs once the company stops pushing for growth ...
The lower the percentage, the more expensive it is. In the case of Cava, it is 0.2%. In other words, the amount of required growth baked into Cava is outrageous. It's a lot of assumed free cash ...
In November 2018, Cava Group bought Zoës Kitchen, a restaurant chain with more than 250 locations, in a deal worth $300 million, taking the company private and helping Cava expand further into the suburbs. [6] [17] [18] As of August 2021, there are 133 Cava locations. All Cava restaurants are company-owned, and none are franchised. [6]
The stock is expensive, but Cava has proven it deserves a premium. While its valuation presents some risk, the restaurant stock continues to look like a long-term winner.