How CAVA Stays Affordable Amid Expansion
CAVA, the fast-casual Mediterranean chain, is attracting investor attention.
JPMorgan analyst John Ivankoe reaffirmed his $110 price target for CAVA, suggesting a potential 27% upside from its current level. He reiterated a bullish stance: "We see this as a buy now and hold for the long term,” highlighting CAVA's growth potential in the U.S. market.
One key to CAVA's success has been its ability to keep menu prices down relative to its peers. Since 2019, the CPI has increased 23%, while Cava's prices have increased only 15%.
Despite its rapid expansion, adding 58 net new restaurants last year, CAVA has maintained affordable prices by investing in technology that streamlines operations and optimizes labor efficiency.
Unlike competitors such as Wendy’s and Taco Bell, which use AI for drive-thru orders, CAVA applies technology behind the scenes, using AI-powered video to track ingredient depletion and help teams prioritize meal prep.
CAVA’s commitment to using technology to enhance—rather than replace—the human element of food service will enable it to create a superior customer experience. This approach sets CAVA apart from competitors that prioritize ruthless cost-cutting.
