Title

Earning Preview: CAVA Group Inc. this quarter’s revenue is expected to increase by 19.54%, and institutional views are predominantly bullish

Abstract

CAVA Group Inc. is scheduled to release its quarterly results on February 24, 2026 Post Market, with current projections pointing to revenue of $267.65 million and adjusted EPS of $0.03 year over year, setting the stage for investors to focus on revenue resilience, cost discipline, and trajectory into early 2026.

Market Forecast

The market’s current working view for CAVA Group Inc. anticipates solid top-line growth with some near-term pressure on profitability metrics. For the current quarter, revenue is projected at $267.65 million, implying 19.54% year-over-year growth, with adjusted EPS estimated at $0.03, reflecting a 61.11% year-over-year decline; EBIT is forecast at $0.76 million, down 75.76% year over year. Forecast margin detail has not been provided, so attention centers on revenue expansion and the mix of growth versus near-term earnings investment ahead of spring demand. CAVA Group Inc.’s core restaurant operations remain the central engine of performance, expected to account for essentially all revenue this quarter as unit expansion and demand activation continue to support high-teens year-over-year sales growth. The most promising business remains the core restaurant portfolio, effectively the entire company, with revenue projected at $267.65 million, up 19.54% year over year.

Last Quarter Review

For the prior quarter, CAVA Group Inc. delivered revenue of $292.24 million, a gross profit margin of 37.84%, GAAP net profit attributable to the parent company of $14.75 million, a net profit margin of 5.05%, and adjusted EPS of $0.12; revenue rose 19.86% year over year while adjusted EPS declined 20.00% year over year. Sequentially, net profit decreased by 19.71%, highlighting seasonal and cost-timing dynamics that moderated the bottom line despite strong year-over-year growth in absolute sales. Main business performance was concentrated in the company’s core restaurant operations, which generated $289.79 million (99.16% of total), with “Other” contributing $2.45 million; consolidated revenue increased 19.86% year over year, underscoring broad-based growth through the company’s core footprint.

Current Quarter Outlook (with major analytical insights)

Core Restaurant Operations

CAVA Group Inc.’s single economic engine remains its core restaurant operations, and the quarter ahead is set to be defined by maintaining high-teens year-over-year revenue growth while navigating near-term profitability trade-offs. The company’s revenue forecast of $267.65 million, up 19.54% year over year, implies healthy demand, underpinned by unit additions and sustained customer engagement. While sequential revenue is expected to step down from $292.24 million, the year-over-year comp remains constructive, suggesting that core throughput and check dynamics continue to support resilient sales expansion. Consensus commentary going into this print emphasizes traffic capture, digital engagement, and menu innovation as catalysts for top-line momentum. With last quarter’s gross margin at 37.84% and a net margin of 5.05%, the revenue base provides room for operational leverage as labor scheduling, food procurement, and in-restaurant throughput normalize into spring. The company’s adjusted EPS is estimated at $0.03, indicating a shift in mix toward reinvestment and startup costs tied to new unit deployment, which is consistent with a model where incremental sales growth and unit expansion drive long-term earnings power even if near-term profit metrics compress. Given that nearly all revenue historically comes from the core restaurants, the key watch items this quarter are same-store sales quality, price versus traffic balance, and the cadence of new store contribution. With EBIT expected at $0.76 million and year-over-year EBIT growth projected to be down 75.76%, investors should expect management to weigh scale-building and brand development against near-term profitability, setting a base for margin regain as calendar 2026 progresses. The trade-off fits a familiar pattern: robust year-over-year revenue, modest sequential normalization, and a focus on healthy unit economics that convert to earnings as pre-opening and marketing expenses abate.

New Unit Openings and Development

The largest growth lever remains the company’s new unit development program, which ultimately feeds the core restaurant revenue line. Because the company effectively reports a single operating revenue stream, the development pipeline is the most promising business driver in the near and medium term. This quarter’s consolidated revenue is projected at $267.65 million, up 19.54% year over year, which implicitly captures contributions from recently opened locations; as new units reach maturity, they generally move up the sales curve, reinforcing the topline and enabling cost absorption over time. From a profitability standpoint, the step-down in estimated EBIT to $0.76 million and a 61.11% expected year-over-year decline in adjusted EPS are consistent with a period of elevated pre-opening expense, initial staffing inefficiencies, and ramping promotional activity. These dynamics are typically front-loaded, moderating early P&L while setting the foundation for revenue growth in subsequent quarters. The company’s last-quarter gross margin of 37.84% offers a benchmark for unit-level economics; as supply chain and labor workflows stabilize at newly opened sites, throughput gains and learning-curve effects typically improve flow-through. Given the concentration of revenue in the core restaurant segment, successful development execution (site selection, construction timeline adherence, and early operations) can meaningfully influence quarter-to-quarter earnings shape. The model trajectory suggests that investments taken now should translate into improved productivity and margin expansion as the calendar progresses, assuming steady demand and disciplined cost control. For the current quarter, investors should weigh unit opening pace and pre-opening spend against the projected 19.54% uplift in consolidated revenue, viewing near-term profit pressure as largely a function of growth investments rather than demand weakness.

Key Stock Price Swing Factors This Quarter

The most immediate stock drivers are the quality of same-store sales and the balance of price versus traffic in the reported quarter. With revenue projected to increase 19.54% year over year, the market will parse whether this growth is primarily attendance-led or price/mix-led, given the implications for sustainability and volume scalability. A healthy traffic contribution, in particular, would provide a more durable foundation for unit-level economics as fixed-cost leverage improves with higher throughput. Profitability optics will also matter. Last quarter’s net margin was 5.05%, and the current quarter’s EBIT estimate is $0.76 million, indicating a near-term compression in operating profit. Investors will focus on whether cost pressures stem from transitory growth factors—such as pre-opening and marketing—or structural components like wage inflation or sustained commodity cost elevation. If management signals that the bulk of the margin pressure is growth-related and therefore expected to ease, the market could look past short-term EPS compression and refocus on the revenue trajectory and unit expansion capacity. Finally, any commentary on digital engagement, loyalty activation, and throughput initiatives can recalibrate expectations for second-half margin recovery. Forecast EPS of $0.03, down 61.11% year over year, sets a low base; upside could emerge if pre-opening drags are milder than feared or if sales leverage offsets a portion of expense growth. Conversely, if EBIT falls below the $0.76 million estimate or if sales decelerate below the projected 19.54% year-over-year increase, the market may question the near-term payoff of growth investment, potentially amplifying volatility around the print.

Analyst Opinions

The prevailing sell-side stance skews decisively positive ahead of February 24, 2026, with bullish opinions outnumbering neutral views by a ratio of 5 to 1 within the recent window. Multiple institutions have reiterated or initiated favorable ratings alongside higher or reaffirmed price targets, grounding their views in sustained revenue growth expectations and a belief that near-term margin compression reflects growth investment rather than underlying demand weakness. The majority perspective emphasizes a robust top-line trajectory supported by unit expansion and customer engagement initiatives, with valuation anchored by mid- to long-term earnings power as new restaurants mature. Institutional calls in early 2026 underscore this bias. On January 22, 2026, RBC Capital maintained a Buy rating with an $80 price target, signaling confidence that unit development and sales momentum can overcome temporary profitability pressure. On February 5, 2026, a new Buy initiation from Benchmark with an $80 price target reinforced the constructive narrative, aligning with a broader pattern of favorable coverage in January and February. On January 27, 2026, one major bank lifted its target to $82 from $80, citing continuous progress in the growth story; this was complemented by a January 9, 2026 Outperform initiation from another respected research house with an $85 price target, along with a January 8, 2026 Buy reiteration and a price target increase to $78 by another U.S. brokerage. In contrast, a January 6, 2026 Neutral rating with a $66 target provides a minority, more cautious view, highlighting valuation sensitivity and near-term earnings compression risks. The bullish consensus coalesces around three core pillars that connect directly to the quarter’s setup. First, analysts anticipate revenue growth to remain resilient at 19.54% year over year this quarter, which aligns with ongoing unit additions and engagement initiatives, and suggests the top line can stay ahead of the broader casual dining complex even as the company absorbs growth costs. Second, while EBIT is estimated at $0.76 million and adjusted EPS at $0.03 for the period, the majority argue these figures are reflective of elevated pre-opening and marketing spend rather than deterioration in underlying unit economics, thereby framing any earnings pressure as investment-driven and temporary. Third, with multiple price targets clustered around $78–$85, the bullish camp expects revenue progression and maturing cohorts to reset margins higher as the year advances, reducing the gap between current run-rate profitability and long-run earnings potential. In assessing the near-term print, bullish analysts will scrutinize the mix underlying the 19.54% projected revenue increase. If management can demonstrate healthy traffic patterns and early evidence that recent openings are ramping on plan, the case for durable revenue compounding strengthens. Similarly, if gross margin efficiency improves from last quarter’s 37.84% baseline despite seasonality and cost inflation, investors may infer that operating leverage and procurement discipline are tracking to plan, reinforcing the outlook for margin expansion later in 2026. Given that last quarter’s net margin was 5.05% and net profit fell sequentially by 19.71%, clear guidance that these drags reflect transient dynamics tied to expansion could support the bullish narrative that earnings should recover as the calendar progresses. The minority neutral stance highlights valuation sensitivity and the risk that elevated expense run-rates could persist longer than expected. However, the prevalence of Buy and Outperform ratings in January and February 2026, combined with multiple upward or reaffirmed price targets, reflects the majority view that the company’s trajectory remains intact. Under this framework, any near-term underperformance versus the $0.03 EPS and $0.76 million EBIT estimates would be weighed against the durability of the 19.54% revenue growth and the quality of unit additions. Should sales performance meet or beat expectations while expense levels look transitory, the dominant bullish camp argues that the stock should be well-positioned into the spring, especially as operating leverage improves from the current base. In sum, the majority of analysts remain constructive on CAVA Group Inc. into the February 24, 2026 Post Market report. Their emphasis on revenue durability, disciplined unit growth, and the transitory nature of near-term cost pressures aligns with the forecast profile for the quarter—high-teens year-over-year sales growth with temporarily compressed profitability. Confirmation that new units are ramping on plan, that sales quality leans toward traffic, and that expense headwinds show signs of abating would validate the consensus bullish stance and support the cluster of price targets near $80–$85, framing the upcoming report as a key checkpoint for both growth and margin trajectory.