Think Cava Stock is Expensive? This Chart Might Change Your Mind.

Cava Group (NYSE: CAVA) stock was a breakout winner last year as the market cap of the Mediterranean fast-casual restaurant chain more than doubled on blistering growth. The numbers the company is generating right now are reminiscent of Chipotle Mexican Grill, the leader and pioneer in fast casual, and Cava's average unit volumes, or average sales per restaurant, are already approaching Chipotle levels.However, after soaring through most of 2024, Cava's stock price pulled back following the release of its third-quarter earnings report in mid-November, seemingly due to valuation concerns as its results were strong. Even after a rebound this month, the stock trades down 17% from its earlier peak.On one level, the stock does look expensive, trading at a price-to-earnings ratio above 200, but if you take a closer look at the numbers, you might find that Cava isn't quite as expensive as you thought. As you can see from the chart below, analysts have rapidly revised their earnings estimates higher for the company, showing they've consistently underestimated it.Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool