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In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 23.1%. CAVA’s earnings surpassed estimates in three of the trailing four quarters and missed once, with the average surprise of 25%, as shown in the chart below.
Image Source: Zacks Investment Research
CAVA’s Q3 Estimate Revisions
The Zacks Consensus Estimate for third-quarter earnings per share (EPS) has been unchanged at 13 cents in the past seven days. The projected figure indicates a decline of 13.3% from the year-ago reported EPS of 15 cents. The consensus mark for revenues is pegged at $293.3 million, implying 20.3% year-over-year growth.
What the Zacks Model Unveils for CAVA
Our proven model does not conclusively predict an earnings beat for CAVA this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here.
CAVA’s Earnings ESP: CAVA currently has an Earnings ESP of -5.77%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Zacks Rank of CAVA: The company carries a Zacks Rank #4 (Sell) at present.
CAVA’s top line in third-quarter 2025 is likely to have benefited from several key factors that built on the momentum seen in the second quarter. The company’s strong restaurant expansion program and robust average unit volumes are expected to have driven revenue growth. Management’s strategy of entering new markets like Michigan and Pittsburgh and deepening its footprint in existing regions has expanded brand awareness and guest adoption. Furthermore, CAVA’s Mediterranean positioning remains a major tailwind, as consumer demand for flavorful yet health-forward dining continues to accelerate, giving the brand a clear advantage as the category’s dominant leader with no scaled competition.
Another factor likely aiding third-quarter 2025 top-line growth is CAVA’s robust menu and product innovation pipeline. The nationwide rollout of chicken shawarma, following successful tests in Dallas and Tampa, adds a high-demand, premium protein option to the menu. This introduction, coupled with new cinnamon sugar pita chips and the ongoing popularity of fan-favorite pita chip offerings, is expected to have driven both traffic and average check growth. Moreover, initiatives to enhance loyalty engagement, such as tiered rewards programs and brand storytelling through the “Peter Chip” campaigns, bode well.
Operational and technological enhancements are also likely to have supported revenue momentum in third-quarter 2025. The continued rollout of CAVA’s Connected Kitchen initiative, including new kitchen display systems, TurboChef ovens and AI camera vision technology, has improved order accuracy and throughput, particularly for digital channels. These advancements enhanced guest satisfaction and operational efficiency, enabling restaurants to handle higher sales volumes without compromising service quality. Together, these factors underscore CAVA’s ability to deliver consistent growth through disciplined execution, innovation and digital engagement.
However, CAVA’s third-quarter 2025 earnings might have faced some pressure from rising costs and margin headwinds. Inflation in key proteins like beef and chicken, modest tariff-related impacts and investments in wage increases might have weighed on profitability. The introduction of premium items such as chicken shawarma is likely to have driven food costs. Additionally, continued investments in technology, leadership expansion (such as the rollout of assistant general managers) and new restaurant openings are likely to have increased expenses. While these factors support long-term scalability, they are likely to have tempered earnings growth despite solid revenue gains.
Price Performance & Valuation of CAVA
CAVA stock has declined 59.2% over the past year, underperforming its industry peers and the broader market. In the same time frame, the stock has also underperformed other industry players like Domino’s Pizza, Inc. (DPZ - Free Report) , Chipotle Mexican Grill, Inc. (CMG - Free Report) and Restaurant Brands International Inc. (QSR - Free Report) .
Price Performance
Image Source: Zacks Investment Research
Analysts have expressed concerns that CAVA stock is overvalued. The company is currently valued at a premium compared with its industry on a forward 12-month P/S basis. Its forward 12-month price-to-sales ratio stands at 4.47, higher than the industry average.
P/S (F12M)
Image Source: Zacks Investment Research
Investment Thoughts for CAVA
Investors may consider avoiding CAVA stock ahead of its third-quarter earnings release due to near-term uncertainty surrounding profitability and valuation.
While the company’s revenue momentum remains solid, driven by menu innovation and rapid expansion, margin pressures from rising food and labor costs, tariffs and higher operating expenses tied to new restaurant openings and technology investments could weigh on earnings. Moreover, with sentiment turning cautious and the stock trading at a premium compared with peers, any earnings disappointment or conservative outlook could trigger further downside. Given these factors, it may be prudent for investors to stay on the sidelines until greater earnings visibility and margin stability emerge.
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CAVA Stock Before Q3 Earnings: Is it Time to Buy or Sit Tight?
Key Takeaways
CAVA Group, Inc. (CAVA - Free Report) is slated to release third-quarter 2025 results on Nov. 4, after the closing bell.
In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 23.1%. CAVA’s earnings surpassed estimates in three of the trailing four quarters and missed once, with the average surprise of 25%, as shown in the chart below.
Image Source: Zacks Investment Research
CAVA’s Q3 Estimate Revisions
The Zacks Consensus Estimate for third-quarter earnings per share (EPS) has been unchanged at 13 cents in the past seven days. The projected figure indicates a decline of 13.3% from the year-ago reported EPS of 15 cents. The consensus mark for revenues is pegged at $293.3 million, implying 20.3% year-over-year growth.
What the Zacks Model Unveils for CAVA
Our proven model does not conclusively predict an earnings beat for CAVA this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here.
CAVA’s Earnings ESP: CAVA currently has an Earnings ESP of -5.77%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Zacks Rank of CAVA: The company carries a Zacks Rank #4 (Sell) at present.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Factors Influencing CAVA’s Q3 Performance
CAVA’s top line in third-quarter 2025 is likely to have benefited from several key factors that built on the momentum seen in the second quarter. The company’s strong restaurant expansion program and robust average unit volumes are expected to have driven revenue growth. Management’s strategy of entering new markets like Michigan and Pittsburgh and deepening its footprint in existing regions has expanded brand awareness and guest adoption. Furthermore, CAVA’s Mediterranean positioning remains a major tailwind, as consumer demand for flavorful yet health-forward dining continues to accelerate, giving the brand a clear advantage as the category’s dominant leader with no scaled competition.
Another factor likely aiding third-quarter 2025 top-line growth is CAVA’s robust menu and product innovation pipeline. The nationwide rollout of chicken shawarma, following successful tests in Dallas and Tampa, adds a high-demand, premium protein option to the menu. This introduction, coupled with new cinnamon sugar pita chips and the ongoing popularity of fan-favorite pita chip offerings, is expected to have driven both traffic and average check growth. Moreover, initiatives to enhance loyalty engagement, such as tiered rewards programs and brand storytelling through the “Peter Chip” campaigns, bode well.
Operational and technological enhancements are also likely to have supported revenue momentum in third-quarter 2025. The continued rollout of CAVA’s Connected Kitchen initiative, including new kitchen display systems, TurboChef ovens and AI camera vision technology, has improved order accuracy and throughput, particularly for digital channels. These advancements enhanced guest satisfaction and operational efficiency, enabling restaurants to handle higher sales volumes without compromising service quality. Together, these factors underscore CAVA’s ability to deliver consistent growth through disciplined execution, innovation and digital engagement.
However, CAVA’s third-quarter 2025 earnings might have faced some pressure from rising costs and margin headwinds. Inflation in key proteins like beef and chicken, modest tariff-related impacts and investments in wage increases might have weighed on profitability. The introduction of premium items such as chicken shawarma is likely to have driven food costs. Additionally, continued investments in technology, leadership expansion (such as the rollout of assistant general managers) and new restaurant openings are likely to have increased expenses. While these factors support long-term scalability, they are likely to have tempered earnings growth despite solid revenue gains.
Price Performance & Valuation of CAVA
CAVA stock has declined 59.2% over the past year, underperforming its industry peers and the broader market. In the same time frame, the stock has also underperformed other industry players like Domino’s Pizza, Inc. (DPZ - Free Report) , Chipotle Mexican Grill, Inc. (CMG - Free Report) and Restaurant Brands International Inc. (QSR - Free Report) .
Price Performance
Image Source: Zacks Investment Research
Analysts have expressed concerns that CAVA stock is overvalued. The company is currently valued at a premium compared with its industry on a forward 12-month P/S basis. Its forward 12-month price-to-sales ratio stands at 4.47, higher than the industry average.
P/S (F12M)
Image Source: Zacks Investment Research
Investment Thoughts for CAVA
Investors may consider avoiding CAVA stock ahead of its third-quarter earnings release due to near-term uncertainty surrounding profitability and valuation.
While the company’s revenue momentum remains solid, driven by menu innovation and rapid expansion, margin pressures from rising food and labor costs, tariffs and higher operating expenses tied to new restaurant openings and technology investments could weigh on earnings. Moreover, with sentiment turning cautious and the stock trading at a premium compared with peers, any earnings disappointment or conservative outlook could trigger further downside. Given these factors, it may be prudent for investors to stay on the sidelines until greater earnings visibility and margin stability emerge.