US Markets
Tuesday, February 27th, 2024 3:57 pm EDT
Key Points
- Cava’s stock surged by 7% on Tuesday morning following the early release of its earnings report, which was originally expected after market close on Tuesday afternoon.
- Cava reported a significant turnaround in its financial performance, with fourth-quarter net income of $2.05 million, a stark contrast to the previous year’s net loss of $18.85 million. This exceeded Wall Street analysts’ expectations, who anticipated the company to break even for the quarter.
- The chain experienced remarkable revenue growth, with a 36% increase to $177.1 million, and same-store sales rose by 11.4%, far surpassing analysts’ expectations. Looking ahead to 2024, Cava outlined plans to open between 48 and 52 new locations, projecting further growth in same-store sales and adjusted earnings.
Cava, the Mediterranean restaurant chain, surprised investors with an early release of its earnings report, leading to a 7% surge in its stock price on Tuesday morning. Originally scheduled for release after Tuesday afternoon’s market close, the company rushed its press release on Monday evening following leaked versions of the results. The fourth-quarter report revealed a remarkable turnaround, with Cava posting a net income of $2.05 million, or 2 cents per share, a stark contrast to the previous year’s net loss of $18.85 million, or $13.72 per share. This performance exceeded Wall Street’s expectations, as analysts anticipated the company to merely break even for the quarter. Moreover, Cava experienced a substantial revenue increase of 36% to $177.1 million, surpassing analysts’ predictions of $174 million, while its same-store sales surged by 11.4%, far outstripping estimates of 5.9% growth. Looking ahead to 2024, Cava outlined ambitious plans to open between 48 and 52 new locations, projecting a 3% to 5% growth in same-store sales and adjusted earnings before interest, taxes, depreciation, and amortization in the range of $86 million to $92 million. Since its initial public offering in June, Cava’s shares have skyrocketed by 145%, propelling the restaurant chain to a market value of $6.14 billion, a figure that only surged further with Tuesday’s stock movement.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/02/27/cava-stock-pops-after-blunder-leads-to-early-earnings-release.html
