Fast casuals like Cava are the biggest winners in this economy
Shares of Cava, the Mediterranean fast casual chain, surged after earnings beat Wall Street expectations.
The stock gained over 20% on Friday and hit over $125 per share at one point, the highest since Cava went public in June 2023. Prices more than doubled this year, pushing the market cap to about $14.2 billion. For its 341 locations, that’s about $42 million per store.
“At a time when consumers are increasingly feeling the pressure of an uncertain economy and are more discerning about where and how they spend their money, they are choosing to dine at Cava,” CEO Brett Schulman said during the earnings call.
While other restaurants saw slower traffic, Cava said that their traffic grew 9.5% in the second quarter, driving same-store sales up 14.4%.
Same-store sales at fast casual rivals like Chipotle and Sweetgreen also grew 11.1% and 9%, respectively. That came as conventional fast food restaurants struggle to keep their customers, who’ve been fed up with high prices in an uncertain spending environment. The introduction of cheap, value meals have gained traction, yet its unclear whether they can revive the fast food industry.
“At a time when consumers are increasingly feeling the pressure of an uncertain economy and are more discerning about where and how they spend their money, they are choosing to dine at Cava,” CEO Brett Schulman said during the earnings call.
While other restaurants saw slower traffic, Cava said that their traffic grew 9.5% in the second quarter, driving same-store sales up 14.4%.
Same-store sales at fast casual rivals like Chipotle and Sweetgreen also grew 11.1% and 9%, respectively. That came as conventional fast food restaurants struggle to keep their customers, who’ve been fed up with high prices in an uncertain spending environment. The introduction of cheap, value meals have gained traction, yet its unclear whether they can revive the fast food industry.
