CAVA Group, Inc. (CAVA) Stock Valuation — PE Analysis
Restaurants · NYSE
Current Price
$65.86
PE Ratio (TTM)
123.7x
Intrinsic Value
$44.41
-48.3% margin of safety
COMPETITIVE MOAT
↑Differentiated Mediterranean Concept
CAVA offers a unique Mediterranean fast-casual experience that appeals to health-conscious consumers. This distinct menu differentiates it from broader fast-casual competitors.
↑Rapid Expansion and Brand Recognition
Aggressive store growth is building brand awareness and customer loyalty across new markets. This scale advantage is becoming increasingly important in the competitive landscape.
↑Traffic-Led Growth Strategy
Focus on driving customer traffic through appealing offerings and value creates a virtuous cycle. This organic growth supports sustained revenue increases.
INVESTMENT RISKS
↓Execution Risk in Rapid Expansion
Scaling quickly introduces risks in maintaining operational consistency and quality across new locations. Poor execution can damage brand reputation.
↓Dependence on Consumer Spending Trends
CAVA's success is tied to discretionary consumer spending, which can be volatile. Economic downturns or shifts in dietary preferences pose a threat.
↓Vulnerability to Food Safety Incidents
Any food safety issue, however isolated, can have a significant negative impact on brand trust and sales. Strict adherence to protocols is critical.
Base case
CAVA base case PE valuation
At a current price of $65.86, the base case PE valuation puts CAVA fair value near $44.41 per share. That figure assumes 20.0% yearly earnings growth, a target PE multiple of 50x, and a 10% discount rate.
Intrinsic Value
$44.41
Margin of safety
-48.3%
Expected annual return
-7.6%
Base case assumptions: 20.0% annual earnings growth, 50x target PE, 10% discount rate, 5 year projection. Data as of 2026-07-30.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the CAVA PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for CAVA Group, Inc. respond.
Open PE Calculator for CAVACompany Overview
CAVA Group, Inc. is a company that oversees and runs a chain of Mediterranean restaurants. Their culinary offerings encompass a range of salads, savory dips, spreads, various toppings, and distinctive dressings. Beyond its dining establishments, the company distributes its products through whole food markets and other grocery retailers. Customers also have the option to utilize online food ordering services for convenience. Founded in 2006, CAVA Group, Inc. maintains its primary business operations in Washington, D.C.
Financial Metrics — CAVA PE Stock Valuation Data
PE Ratio (TTM)
123.7x
PEG Ratio
n/m
Earnings Yield
0.80%
ROE (TTM)
7.9%
Revenue/Share (TTM)
$11.05
Debt/Equity
0.62x
Frequently Asked Questions
What is the PE ratio of CAVA?
The trailing twelve-month PE ratio of CAVA reflects how much investors pay per dollar of CAVA Group, Inc.'s earnings. This metric is most useful when compared to Restaurants peers and the company's own historical range.
Is CAVA overvalued based on PE ratio?
CAVA's PE of 123.7x combined with a PEG ratio of -2.16 provides a growth-adjusted perspective. CAVA has negative earnings, so its PE and PEG ratios are not meaningful here and cannot tell you whether the stock is over or undervalued. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Restaurants, a DCF analysis may be more appropriate.
How do I value CAVA stock using PE ratio?
To value CAVA Group, Inc. using PE: (1) Compare the current PE (123.7x) against the Restaurants median to assess relative pricing, (2) check the PEG ratio (-2.16) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of CAVA?
CAVA's PEG ratio is -2.16, calculated by dividing the PE ratio (123.7x) by the expected earnings growth rate. Because CAVA has negative earnings, its PEG ratio is not meaningful and should not be read as a sign of under or overvaluation. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for CAVA stock valuation?
PE ratio gives a quick relative read — how CAVA is priced versus Restaurants peers. DCF provides an absolute value based on projected free cash flows. For the most reliable valuation, use PE as a quick comparability screen and DCF for a deeper fundamental analysis. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See CAVA DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Consumer Cyclical valuationsP/E and DCF value CAVA with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-07-30. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.