WASHINGTON - CAVA Group, Inc. (NYSE: CAVA), a fast-casual Mediterranean restaurant brand, posted quarterly earnings of $0.02 per share, beating the estimate of $0.00, while revenue for the quarter reached $175.5 million, exceeding the consensus estimate of $172.41 million.
The revenue growth, which marked a 52.5% increase compared to the same quarter last year, was attributed to the opening of 95 new CAVA restaurants and an 11.4% growth in same-restaurant sales, which includes a 6.2% increase from guest traffic and a 5.2% rise from menu price and product mix. The company's restaurant-level profit margin also saw improvement, rising by 240 basis points over the prior year quarter to 22.4%.
Brett Schulman, Co-Founder and CEO, highlighted the company's successful year, noting the opening of 72 new restaurants, a 30% increase in the restaurant footprint, and nearly 60% full-year revenue growth. Schulman credited the company's operating model and team members for the strong performance and expressed confidence in CAVA's position to capitalize on its growth potential.
Looking ahead, CAVA Group provided guidance for fiscal 2024, projecting same-restaurant sales growth of 3.0% to 5.0% and adjusted EBITDA of $86.0 to $92.0 million. This guidance indicates a positive outlook for the company as it continues to expand and capture market share.
CAVA's performance demonstrates its ability to thrive in the competitive fast-casual dining sector and its potential for continued expansion and profitability.
Stock is up 6% in pre-market trading Tuesday.
InvestingPro Insights
CAVA Group, Inc.'s remarkable performance in the stock market and its robust revenue growth is further complemented by insightful metrics and tips from InvestingPro. With a market capitalization of $309.19 million, the company is positioning itself as a significant player in the fast-casual dining sector. The earnings multiple, standing at a P/E ratio of 10.29, indicates that the stock is trading at a relatively low valuation compared to earnings, which could appeal to value-oriented investors.
The company's revenue for the last twelve months as of Q4 2023 reached $24.62 million, showcasing an impressive year-over-year growth rate of 119.01%. This aligns with the company's reported increase in same restaurant sales and its aggressive expansion strategy. An InvestingPro Tip that stands out is that CAVA holds more cash than debt on its balance sheet, suggesting a solid financial foundation that could support further growth and operational flexibility.
Another InvestingPro Tip indicates that the stock is currently in oversold territory according to the Relative Strength Index (RSI). This could be an indicator for potential investors that the stock might be undervalued, presenting a buying opportunity. For investors looking for comprehensive analysis and additional insights, there are over 10 InvestingPro Tips available at https://www.investing.com/pro/CAVA, which can be accessed with a special offer using the coupon code PRONEWS24 for an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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