CAVA
CAVA Group, Inc.
$80.42
Platform & Compounding FCF
85%
Two-stage FCF DCF
Mild
·
Conviction
Overvalued
Trading 14.1% above fair value
You pay
$80.42
Bear
$34.50
Fair
$70.45
Bull
$119.49
Bear
$34.50
-57.1%
14% stage 1 growth, 12% discount
Fair
$70.45
-12.4%
24% stage 1 growth, 12% discount
Bull
$119.49
+48.6%
31% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (24% base case)
Terminal Value % of EV
44%
Implied Market Multiple
65.6x
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $89.63 from 25 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $70.45 per share.
Warnings
This company spends 13% of revenue on big investments like data centers and infrastructure, mostly for growth. We adjusted the cash flow figure to only subtract the upkeep costs, giving a clearer picture of true profitability.
Wall Street's average price target is $89.63 (from 25 analysts). Our estimate is 29% below the consensus -- consider that gap carefully.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions