Cava rallies to record high as solid demand for steaks and salads boost forecasts
Business
Cava rallies to record high as solid demand for steaks and salads boost forecasts
(Reuters) - Mediterranean restaurant chain Cava Group's (CAVA.N), opens new tab shares surged over 23% to a record high of $125.38 on Friday, after strong demand for its salad bowls and pita wraps boosted its annual sales and earnings forecast.
The fast-casual chain, which made a strong market debut in June last year, exceeded second quarter expectations after markets closed on Thursday, and said the system-wide roll out of grilled steak on June 3 generated stronger than expected sales.
Many Americans are cutting back on dining out due to steadily increasing fast-food prices over the past two years, prompting chains such as McDonald's (MCD.N), opens new tab and Burger King (QSR.TO), opens new tab to dole out more offers to attract customers.
Cava, in contrast, took a 3% menu price increase in January with no further price increases planned in 2024, Wedbush analyst Nick Setyan noted.
"While many have commented on decelerating traffic in the market, we have seen sustained momentum," CEO Brett Schulman said on post-earnings call.
