CAVA
CAVA Group, Inc.
$68.85
Platform & Compounding FCF
85%
Two-stage FCF DCF
Mild
·
Conviction
Fair Value
Trading 3.5% below fair value
You pay
$68.85
Bear
$34.93
Fair
$71.34
Bull
$121.00
Bear
$34.93
-49.3%
14% stage 1 growth, 12% discount
Fair
$71.34
+3.6%
24% stage 1 growth, 12% discount
Bull
$121.00
+75.7%
31% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (24% base case)
Terminal Value % of EV
44%
Implied Market Multiple
56.2x
Market is pricing in (growth)
24.9%
vs 23.9% base
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 $93.18 from 25 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $71.34 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 $93.18 (from 25 analysts). Our estimate is 31% 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