Shares of Cava Group (NYSE: CAVA) dropped due to slower same-store sales growth in Q2, missing expectations and leading to a 40% year-to-date decline. Despite revenue climbing 20% YoY, the company’s comps growth of 2.1% fell short of estimates, prompting menu innovations and expansion plans to drive future growth.

Cava’s restaurant-level margins dipped slightly to 26.3%, but adjusted EBITDA rose 23% to $42.1 million in Q2. The company plans to open 68-70 new locations this fiscal year and aims for 1,000 stores by 2032. Management lowered full-year comps outlook but maintained EBITDA and RLM margin forecasts.

With a forward P/E ratio of nearly 123 and P/S ratio of 7 based on 2025 estimates, Cava stock is expensive but offers growth potential. Despite comps growth slowing, Cava’s expansion opportunities and strong store performance make it an attractive long-term investment for investors considering the current dip.

Read more at Yahoo Finance: Cava Shares Crash. Should Investors Buy the Stock on the Dip or Run for the Hills?