Cava shares sizzle as Wall Street bets the fast-casual chain can withstand economic pressure
Bernstein says the Mediterranean chain’s higher-spending customers can help it stay fresh — even with trade pressure.
Cava shares jumped as much as 11% Wednesday, heading toward their biggest one-day gain in over a year, after Wall Street dished out fresh optimism for the fast-growing Mediterranean chain.
Bernstein analysts upgraded the stock to “outperform” from “market perform,” setting a new price target of $115 — implying a 28% upside from current levels. Cava stock has taken a hit this year, down double digits, but analysts are betting on a rebound.
“We expect CAVA to retain its margins of 25% even if a negative macro scenario were to unfold. With limited reliance on imports, we see limited scope for margin compression amid continued sales expansion,” analysts said in the note. “While tariffs could impact the unit development costs, Cava’s healthy cash-on-cash returns should support 15-18% unit growth in 2025-26, and the first store openings in Miami and Indiana continues to prove portability of food.”
The firm points to Cava’s more affluent customer base as a key reason the company can weather tariff headwinds and keep demand strong, even as macro conditions cool. They also noted how, in past recessions, fast-casual concepts usually fared better than the overall dining market.
Bernstein isn’t alone. Last month, analysts at JPMorgan also upgraded Cava to “overweight,” maintaining a $110 price target and echoing confidence in its growth story. Despite the recent dip, Cava shares are up nearly 47% over the past year.
