CAVA

CAVA is one of the highest-quality restaurant-growth stories in the market: 439 fast-casual locations across 28 states, 72 net new openings in fiscal 2025, and revenue surpassing $1.18B (+22.4%). The unit economics are genuinely strong — 2025-class new restaurants are trending above $3.0 million in AUV and system AUV reached $2,934K — and profitability is improving at the operating line, with operating income up 28.2% to $55.3M and operating cash flow up 14.8% to $185M. The balance sheet is healthy (equity $780M vs. $580M liabilities, 0.74x), with $283M cash plus a fixed-income securities portfolio, funding expansion internally.

Two things temper the enthusiasm. First, the headline net-income decline (-51.1% to $63.7M, EPS -50.9% to $0.54) is misleading — it reflects a prior-year tax benefit rather than operating deterioration, since operating income actually rose. But second, and more importantly, same-restaurant sales decelerated sharply to 4.0% from 13.4% the prior year. That ~9-point slowdown is the single most important data point: it shows the comp tailwind that drove the FY2024 surge has faded, and future growth now leans heavily on new-unit expansion (which carries higher capex — up 46.8% to $159M — and execution risk in newer markets like Detroit and Pittsburgh).