CAVA Group (NYSE:CAVA) Shares Down 6.1% – Should You Sell?

CAVA Group, Inc. (NYSE:CAVA)’s share price dropped 6.1% during mid-day trading on Monday . The stock traded as low as $70.20 and last traded at $69.8730. Approximately 346,272 shares were traded during mid-day trading, a decline of 90% from the average daily volume of 3,418,403 shares. The stock had previously closed at $74.42.

Analyst Upgrades and Downgrades

CAVA has been the topic of a number of recent analyst reports. Telsey Advisory Group raised their target price on CAVA Group from $92.00 to $95.00 and gave the stock an “outperform” rating in a report on Wednesday, May 20th. Citigroup reaffirmed a “buy” rating on shares of CAVA Group in a research note on Tuesday, July 28th. KeyCorp lowered their price target on CAVA Group from $110.00 to $95.00 and set an “overweight” rating for the company in a report on Wednesday, August 12th. Morgan Stanley upgraded shares of CAVA Group from an “equal weight” rating to an “overweight” rating and upped their price target for the company from $86.00 to $90.00 in a report on Wednesday, July 15th. Finally, BMO Capital Markets set a $100.00 target price on shares of CAVA Group in a research note on Wednesday, May 20th. Seventeen investment analysts have rated the stock with a Buy rating and nine have issued a Hold rating to the company’s stock. Based on data from MarketBeat, the stock presently has an average rating of “Moderate Buy” and an average price target of $89.44.

CAVA Group Price Performance

The stock has a market capitalization of $8.39 billion, a price-to-earnings ratio of 130.46, a P/E/G ratio of 5.12 and a beta of 1.75. The company’s 50-day simple moving average is $73.07 and its 200-day simple moving average is $76.95.

CAVA Group (NYSE:CAVA) last released its quarterly earnings results on Tuesday, August 11th. The company reported $0.19 EPS for the quarter, beating the consensus estimate of $0.18 by $0.01. The business had revenue of $368.44 million for the quarter, compared to the consensus estimate of $360.09 million. CAVA Group had a net margin of 4.82% and a return on equity of 8.28%. CAVA Group’s revenue was up 31.3% compared to the same quarter last year. During the same period in the prior year, the company posted $0.16 earnings per share. Research analysts expect that CAVA Group, Inc. will post 0.53 earnings per share for the current year.

Insider Buying and Selling

In related news, CAO Adam David Phillips sold 757 shares of the stock in a transaction on Monday, June 15th. The stock was sold at an average price of $89.43, for a total value of $67,698.51. Following the completion of the sale, the chief accounting officer directly owned 6,848 shares in the company, valued at $612,416.64. This represents a 9.95% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available at this hyperlink. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CFO Tricia K. Tolivar sold 4,969 shares of CAVA Group stock in a transaction dated Monday, June 15th. The stock was sold at an average price of $89.43, for a total value of $444,377.67. Following the transaction, the chief financial officer directly owned 234,931 shares in the company, valued at $21,009,879.33. The trade was a 2.07% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders have sold a total of 82,703 shares of company stock valued at $7,249,579 over the last quarter. 6.70% of the stock is currently owned by company insiders.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently modified their holdings of CAVA. BlackRock Inc. acquired a new position in shares of CAVA Group during the second quarter worth approximately $757,013,000. Capital Research Global Investors grew its position in CAVA Group by 27.2% in the 4th quarter. Capital Research Global Investors now owns 8,440,040 shares of the company’s stock valued at $495,344,000 after purchasing an additional 1,805,174 shares during the period. Marshall Wace LLP increased its stake in CAVA Group by 689.8% during the 4th quarter. Marshall Wace LLP now owns 1,387,774 shares of the company’s stock valued at $81,448,000 after purchasing an additional 1,212,068 shares in the last quarter. Primecap Management Co. CA bought a new position in shares of CAVA Group in the second quarter valued at $92,956,000. Finally, William Blair Investment Management LLC acquired a new position in shares of CAVA Group during the second quarter valued at about $89,861,000. Institutional investors and hedge funds own 73.15% of the company’s stock.

About CAVA Group

CAVA Group, Inc (NYSE: CAVA) is a leading fast-casual restaurant company specializing in Mediterranean-inspired cuisine. Operating under the CAVA brand, the company offers customizable bowls, pitas and salads built around a variety of proteins, grains, fresh vegetables and house-made spreads. With a focus on high-quality ingredients and made-to-order preparation, CAVA aims to deliver a casual yet elevated dining experience for dine-in, takeout and catering customers.

Founded in 2011 in the Washington, DC metro area by Ike Grigoropoulos, Dimitri Katsanis and Brett Schulman, CAVA has pursued an aggressive growth strategy that included the 2018 acquisition of Zoe’s Kitchen.