Dj Cava Keeps No-Discounting Stance As Restaurant Deals Abound

Reuters

CAVA Group

-1.19%

Chipotle Mexican Grill

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Cava Keeps No-Discounting Stance as Restaurant Deals Abound — WSJ

Dow Jones Newswires

CAVA Group

-1.19%

By Jennifer Williams

Cava doesn't discount, and it has no plans to even as some diners pull back on eating out. The key is ensuring that cash-conscious consumers see the value in the chain's Mediterranean lunch bowls.

Cava hasn't historically had trouble attracting customers with its no-discount strategy even as other restaurants see deals as a go-to for attracting customers. McDonald's lowered the cost of its combo meals in September. Burger King has said its $5 and $7 deals are helping to drive sales. And Chipotle Mexican Grill this month announced a series of free entree offerings with a purchase that it is running through December.

But Cava isn't going there, even as some diners cut back. The company recently cut its same-store sales outlook and overall profitability for 2025, citing the same pressures that other fast-casual restaurant chains have recently flagged: Consumers, especially younger ones, are spending less on eating out. Appealing to would-be diners who are currently bombarded with discounts could mean joining in on the deals.

"There might be a tendency to try to generate short-term improvements in traffic as a result of discounting," said Cava Chief Financial Officer Tricia Tolivar. "We don't think that has value over the long term."

Even without discounts, Cava diners get a deal, executives have said. A bowl with greens and grains, 12 unlimited toppings including pickled onions, cucumbers and olives, plus chicken is less than $11 in some locations. At most, the same bowl with chicken is just under $13 in New York City. That's higher than a value meal at McDonald's and certain deals at casual restaurant chains. But it's well below lunch for $20, a higher-price point perception that bowl restaurants in particular have struggled to shake as diners look for cheaper meal options.

Cava's same-store sales have been up double-digits in recent quarters, as recently as the three months ended in April. But that growth has started to slow as consumers look for places to trim their spending. Same-store sales were up 1.9% for the three months ended Oct. 5. The company cut its outlook to same-restaurant sales growth of 3% to 4% for the year, down from its prior outlook of 4% to 6%, with executives noting that consumers ages 25 to 35 years old were being more deliberate about their spending.

Still, Cava executives aren't tempted to start discounting its menu. "That's not a path that we're expecting to take at this point," Tolivar said, explaining the chain doesn't want to train its customers to expect price cuts on a regular basis. Cava is focused on value, though, keeping menu price increases to a minimum to offset tariff and inflationary pressures with a roughly 1.7% lift in early 2025. Cava expects price increases next year to be slightly below that, Tolivar said.

Deals don't always have the desired effect of creating profit and keeping diners, but restaurants right now are looking to value offers in hopes of luring cautious customers. "People are cutting back across the board," said Logan Reich, an equity research analyst at RBC Capital Markets. "But the effect is more outsized for the fast casuals because they are not leaning into value or lowering prices at the same time that [fast food chains] are," he said.

But it doesn't make sense for Cava long-term to lean on deals or discounts, Reich said. When a brand changes from not adjusting prices because of shifts in consumer spending or confidence to a more reactive pricing strategy, there could be lasting impacts, he said. "Once you brand yourself as a discounter, the consumer will realize that, and it sort of shifts the brand value perception over the long term."

Cava's marketing team is working to spread the message about the value of its menu items, said Tolivar, the CFO. More than showcasing deals, analysts see an opportunity to simply introduce people to the brand through marketing, which at $8.8 million last year, accounted for less than 1% of sales. Cava declined to share a target for marketing spend.

Its new restaurants tend to do well. On average, locations opened in 2025 are trending above $3 million in annual sales, higher than the chainwide $2.9 million average. Growth is primarily through word-of-mouth and organic discovery so far, said Chris O'Cull, a managing director at Stifel. Marketing can expand the reach.

"Cava's challenge is just getting more people in to try the brand," O'Cull said.

Write to Jennifer Williams at jennifer.williams@wsj.com

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U.S. stocks higher at close of trade; Dow Jones Industrial Average up 0.86%

Investing.com

Sonnet BioTherapeutic

Investing.com – U.S. stocks were higher after the close on Wednesday, as gains in the Oil & Gas, Consumer Goods and Financials sectors led shares higher.

At the close in NYSE, the Dow Jones Industrial Average rose 0.86%, while the S&P 500 index climbed 0.30%, and the NASDAQ Composite index climbed 0.17%.

The best performers of the session on the Dow Jones Industrial Average were Unitedhealth Group (NYSE:UNH), which rose 4.67% or 15.17 points to trade at 339.71 at the close. Meanwhile, Goldman Sachs Group Inc (NYSE:GS) added 2.62% or 21.36 points to end at 836.57 and McDonald’s Corporation (NYSE:MCD) was up 2.32% or 6.99 points to 307.71 in late trade.

The worst performers of the session were Microsoft Corporation (NASDAQ:MSFT), which fell 2.44% or 11.96 points to trade at 478.04 at the close. Travelers Companies (NYSE:TRV) declined 1.47% or 4.25 points to end at 284.27 and Boeing Co (NYSE:BA) was down 1.38% or 2.84 points to 202.54.

The top performers on the S&P 500 were Microchip Technology Inc (NASDAQ:MCHP) which rose 12.17% to 63.61, ON Semiconductor Corporation (NASDAQ:ON) which was up 11.01% to settle at 57.15 and Vertex Pharmaceuticals Inc (NASDAQ:VRTX) which gained 6.94% to close at 463.22.

The worst performers were Alexandria Real Estate Equities Inc (NYSE:ARE) which was down 10.09% to 48.40 in late trade, Paramount Skydance Corp (NASDAQ:PSKY) which lost 7.27% to settle at 14.67 and Netflix Inc (NASDAQ:NFLX) which was down 4.93% to 103.96 at the close.

The top performers on the NASDAQ Composite were Capricor Therapeutics Inc (NASDAQ:CAPR) which rose 369.34% to 29.85, Nauticus Robotics Inc (NASDAQ:KITT) which was up 115.89% to settle at 1.56 and Virax Biolabs Group Ltd (NASDAQ:VRAX) which gained 77.32% to close at 0.69.

The worst performers were Sonnet Biotherapeutics Holdings Inc (NASDAQ:SONN) which was down 59.35% to 1.26 in late trade, ScanTech AI Systems Inc (NASDAQ:STAI) which lost 38.44% to settle at 0.23 and Paranovus Entertainment Technology Ltd (NASDAQ:PAVS) which was down 38.29% to 0.03 at the close.

Rising stocks outnumbered declining ones on the New York Stock Exchange by 1969 to 793 and 76 ended unchanged; on the Nasdaq Stock Exchange, 2456 rose and 915 declined, while 154 ended unchanged.

Shares in Alexandria Real Estate Equities Inc (NYSE:ARE) fell to 5-year lows; falling 10.09% or 5.43 to 48.40. Shares in Capricor Therapeutics Inc (NASDAQ:CAPR) rose to 5-year highs; rising 369.34% or 23.49 to 29.85. Shares in ScanTech AI Systems Inc (NASDAQ:STAI) fell to 52-week lows; losing 38.44% or 0.14 to 0.23. Shares in Paranovus Entertainment Technology Ltd (NASDAQ:PAVS) fell to all time lows; falling 38.29% or 0.02 to 0.03.

The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was down 3.07% to 16.08 a new 1-month low.

Gold Futures for February delivery was up 0.45% or 19.20 to $4,240.00 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in January rose 0.80% or 0.47 to hit $59.11 a barrel, while the February Brent oil contract rose 0.58% or 0.36 to trade at $62.81 a barrel.

EUR/USD was unchanged 0.38% to 1.17, while USD/JPY fell 0.40% to 155.24.

The US Dollar Index Futures was down 0.45% at 98.85.

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CAVA (CAVA) Stock Trades Up, Here Is Why

Stock Story

CAVA Group

-1.19%

What Happened?

Shares of mediterranean fast-casual restaurant chain CAVA jumped 3.9% in the afternoon session after the stock continued its recent positive trend, apparently driven by technical factors and market sentiment rather than specific company news. The move extended a recent run-up in which the stock had gained significantly over the previous two weeks. Reports indicated that positive sentiment was prevailing around the stock. This recent price action also followed a buy signal that was issued from a technical pivot point, suggesting the rally was influenced by trading patterns and momentum.

After the initial pop the shares cooled down to $54.24, up 2.9% from previous close.

Is now the time to buy CAVA? Access our full analysis report here.

What Is The Market Telling Us

CAVA’s shares are extremely volatile and have had 32 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 1 day ago when the stock gained 2.9% on the news that the company was placed on an "upside 90-day catalyst watch" amid expectations that the U.S. government's reopening would positively influence sales. This outlook was supported by the company's strong performance in the fiscal third quarter of 2025. During that period, CAVA reported a 20% year-over-year increase in revenue and a 1.9% growth in same-restaurant sales. The company also expanded its footprint by opening 17 new locations, demonstrating its continued growth. The positive catalyst watch was specifically linked to an expected increase in sales around the Washington D.C. area following the reopening.

CAVA is down 52.9% since the beginning of the year, and at $54.24 per share, it is trading 64.1% below its 52-week high of $150.88 from December 2024. Investors who bought $1,000 worth of CAVA’s shares at the IPO in June 2023 would now be looking at an investment worth $1,239.

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Tesla, Netflix among market cap stock movers on Wednesday

Investing.com

Arrowhead Pharmaceuticals

-5.97%

American Eagle

-2.69%

Wednesday’s market has seen swings in various stocks based on news and other factors. Today, stocks like Tesla and Microchip Technology are rallying, while stocks like Pure Storage and Netflix are falling. Below are highlights of some of the biggest stock movers, from mega-caps to small caps.

Mega-Cap Movers (Market Cap:$200 billion USD or higher)

Tesla Motors (TSLA); After AI Push, Trump Administration Is Now Looking To Robots; +3.97%
United Health Group (UNH) +4.49%
Goldman Sachs Group (GS) +2.34%
AbbVie Inc (ABBV) +2.3%
Wells Fargo (WFC); EquipmentShare secures $2.75 billion credit facility led by Wells Fargo; +2.86%
Oracle Corp (ORCL) +2.28%
American Express (AXP) +2.37%
McDonald’s (MCD) +2.45%
Micron Tech (MU); Micron to exit Crucial consumer business by February 2026; -2.97%
Netflix, Inc. (NFLX) -5.71%

Large-Cap Stock Movers (Market Cap:$10-$200 billion USD)

Pure Storage Inc (PSTG); Pure Storage posts in-line Q3 earnings, revenue beat; -26.55%
SanDisk Corp-Exch (SNDK) -7.23%
UL Solutions (ULS); UL Solutions announces secondary offering of 12.5 million shares; -8.45%
Microchip Technology Inc (MCHP); Microchip raises quarterly guidance on strong bookings; +9.77%
ON Semiconductor (ON) +8.18%
Alcoa (AA) +7.86%
Dicks Sporting Goods Inc (DKS) +7.77%
Circle Internet Group Inc (CRCL) +7.58%
Amkor Technology (AMKR) +7.23%
Entegris Inc. (ENTG) +6.73%

Mid-Cap Stock Movers (Market Cap:$2-$10 billion USD)

American Eagle Outfitters (AEO); American Eagle stock soars 11% on strong Q3 results, raised guidance; +13.95%
Sitime Corporation (SITM) +12.5%
Arrowhead Research Corp (ARWR) +11.93%
Alpha Metallurgical Resources (AMR) +11.73%
dMY Technology Group II (GENI) +11.28%
Beam Inc. (BEAM) +12.11%
MTech Acquisition A (ABTC) +9.46%
Reinvent Technology Partners Y (AUR) +10.4%
OneStream (OS); OneStream announces leadership changes to boost AI growth strategy; -9.71%
Gitlab (GTLB); GitLab appoints Jessica Ross as new CFO effective January 2026; -13.21%

Small-Cap Stock Movers (Market Cap:$300 million - $2 billion USD)

MapLight Therapeutics Inc (MPLT) +29.67%
Ambitions Enterprise Management Co (AHMA) +25.71%
Anavex Life Sciences (AVXL) +22.62%
POET Tech NAQ (POET) +22.33%
InterPrivate Acquisition (AEVA); European automaker selects Aeva as exclusive lidar supplier; +21.26%
Fortrea Holdings (FTRE) +16.31%
Kestra Medical Technologies (KMTS); Kestra Medical Technologies prices upsized public offering at $23 per share; +13.99%
Anbio Biotechnology (NNNN) +13.36%
TryHard Holdings (THH) -26.14%
Adc Therapeutics SA (ADCT); ZYNLONTA-glofitamab combo shows 90% response rate in lymphoma trial; -28.48%