Raymond James Starts CAVA Group Inc (CAVA) at Market Perform

Raymond James analyst Brian Vaccaro initiates coverage on CAVA Group Inc (NYSE: CAVA) with a Market Perform rating.

The analyst comments "We are initiating coverage of CAVA with a Market Perform rating as our bullish view of the brand’s key points of differentiation and attractive long-term growth opportunity is offset by the stock’s premium valuation to peers and our DCF fair value estimate of $31/share. We recommend investors be patient for a more attractive entry point to potentially materialize, which could occur in the next 3-6 months given: 1) potential for flat/slightly negative y/y comps in 1Q24 on very difficult comparisons, 2) anticipated store margin pressure in 2024 (vs. very strong levels in 2023) on labor investments and normalized pricing/new unit performance (each outperformed in 2023), and 3) potential secondary offerings (lockup expires 12/11/23)."

For an analyst ratings summary and ratings history on CAVA Group Inc click here. For more ratings news on CAVA Group Inc click here.

Shares of CAVA Group Inc closed at $33.83 yesterday.

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