Cava GroupCAVA +2.39%62 Return-on-Tangible-Equity is 12.15% as of Mar. 2026, which is 41% below its 10-year median of 20.69. GuruFocus rates CAVA with a GF Score™ of 62/100 and a GF Value™ of $88.03 (Modestly Undervalued). The stock has 1 warning sign investors should review. Among 331 Restaurants companies, Cava Group ranks worse than 51.06% on this metric.
Return-on-Tangible-Equity is calculated as Net Income divided by its average total shareholder tangible equity. Total shareholder tangible equity equals to Total Stockholders Equity minus Intangible Assets. Cava Group's annualized net income for the quarter that ended in Mar. 2026 was $94 Mil. Cava Group's average shareholder tangible equity for the quarter that ended in Mar. 2026 was $776 Mil. Therefore, Cava Group's annualized Return-on-Tangible-Equity for the quarter that ended in Mar. 2026 was 12.15%.
The historical rank and industry rank for Cava Group's Return-on-Tangible-Equity or its related term are showing as below:
CAVA'
s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: 8.32 Med: 20.69 Max: 22.96
Current: 8.32
During the past 5 years, Cava Group's highest Return-on-Tangible-Equity was 22.96%. The lowest was 8.32%. And the median was 20.69%.
CAVA's Return-on-Tangible-Equity is ranked worse than 51.06% of 331
companies
in the Restaurants industry
Industry Median: 8.76
vs CAVA: 8.32
Cava Group (NYSE:CAVA) Return-on-Tangible-Equity Explanation
Return-on-Tangible-Equity measures the rate of return on the ownership interest (shareholder's tangible equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' tangible equity (shareholders equity minus intangibles). Return-on-Tangible-Equity shows how well a company uses investment funds to generate earnings growth. Return-on-Tangible-Equitys between 15% and 20% are considered desirable.
Be Aware
Net Income is used.
Because a company can increase its Return-on-Tangible-Equity by having more financial leverage, it is important to watch the leverage ratio when investing in high Return-on-Tangible-Equity companies. Like Return-on-Tangible-Asset, Return-on-Tangible-Equity is calculated with only 12 months data. Fluctuations in company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Asset light businesses require very few assets to generate very high earnings. Their Return-on-Tangible-Equitys can be extremely high.
Cava Group Return-on-Tangible-Equity Related Terms
Cava Group Return-on-Tangible-Equity Historical Data
* Premium members only.
The historical data trend for Cava Group's Return-on-Tangible-Equity can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
CAVA vs BROS, DPZ, LKNCY: Return-on-Tangible-Equity Comparison
For the Restaurants subindustry, Cava Group's Return-on-Tangible-Equity, along with its competitors' market caps and Return-on-Tangible-Equity data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Cava Group Return-on-Tangible-Equity vs Restaurants Industry
For the Restaurants industry and Consumer Cyclical sector, Cava Group's Return-on-Tangible-Equity distribution charts can be found below:
* The bar in red indicates where Cava Group's Return-on-Tangible-Equity falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
In the calculation of annual Return-on-Tangible-Equity, the net income of the last fiscal year and the average total shareholder tangible equity over the fiscal year are used. In calculating the quarterly data,
the net income data used here is four times the quarterly (Mar. 2026) net income data.
Return-on-Tangible-Equity is displayed in the 10-year financial page.
What does a Return-on-Tangible-Equity of 12.15% mean?
Cava Group (CAVA) has a Return-on-Tangible-Equity of 12.15% as of Mar. 2026. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on Cava Group and its competitors. This is 41% below median its historical median of 20.69. Over the past decade, Cava Group's Return-on-Tangible-Equity has ranged from 8.32 to 22.96. According to the industry distribution chart, Cava Group ranks #169 out of 331 companies in the Restaurants industry, placing it in the top 51.1%.
Is Cava Group's Return-on-Tangible-Equity too high?
Cava Group's current Return-on-Tangible-Equity of 12.15% is 41% below median its 10-year median of 20.69. Over the past 10 years, this metric has ranged from a low of 8.32 to a high of 22.96. The Restaurants industry median Return-on-Tangible-Equity is 8.76. Cava Group's value of 12.15% is 38.7% above this industry median. Based on the distribution chart, Cava Group ranks #169 out of 331 companies in the Restaurants industry, which is below the industry midpoint. Overall, Cava Group has a GF Score™ of 62/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Cava Group's Return-on-Tangible-Equity compare to BROS and DPZ?
According to the Restaurants industry distribution chart, Cava Group ranks #169 out of 331 companies for Return-on-Tangible-Equity. This places Cava Group in the lower half of its industry. The industry median Return-on-Tangible-Equity is 8.76. Cava Group's value of 12.15% is 38.7% above this benchmark. Historically, Cava Group's own Return-on-Tangible-Equity has ranged from 8.32 to 22.96 over the past decade. While the company's 10-year median is 20.69 vs. the industry median of 8.76, Cava Group has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Return-on-Tangible-Equity for a Restaurants company?
The median Return-on-Tangible-Equity among Restaurants companies is 8.76, based on 331 companies in the industry. Companies in the top quartile (top 25%) have a Return-on-Tangible-Equity significantly above this median, while those in the bottom quartile fall well below. However, Return-on-Tangible-Equity should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Cava Group's current Return-on-Tangible-Equity of 12.15% is 38.7% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Return-on-Tangible-Equity mean?
A high Return-on-Tangible-Equity can signal that a stock is expensive relative to its fundamentals. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on Cava Group and its competitors. For the Restaurants industry, the median Return-on-Tangible-Equity is 8.76 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Cava Group's current Return-on-Tangible-Equity is 12.15%, which is 41% below median its own 10-year median of 20.69. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Cava Group stock overvalued right now?
Based on GuruFocus' analysis, Cava Group (CAVA) is currently considered Modestly Undervalued. The stock's GF Value™ is $88.03, compared to a current price of $69.21 — trading 21.4% below its estimated fair value. The current Return-on-Tangible-Equity is 12.15%, which is 41% below median its 10-year median of 20.69 and 38.7% above the Restaurants industry median of 8.76. Cava Group's overall GF Score™ is 62/100 with 1 warning sign to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Return-on-Tangible-Equity calculated?
Return-on-Tangible-Equity is calculated from a company's financial statements. For Cava Group (CAVA), the current Return-on-Tangible-Equity is 12.15% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Cava Group (CAVA) Overvalued in 2026?
Based on GuruFocus' analysis, Cava Group stock appears to be undervalued.
The current stock price of $69.21 is trading 21.4% below its estimated GF Value™ of $88.03.
GuruFocus considers Cava Group to be Modestly Undervalued.
Key valuation signals for CAVA:
Return-on-Tangible-Equity: 12.15% (41% below median its 10-year median of 20.69)
GF Value™: $88.03 vs. price of $69.21 (21.4% below fair value)
Industry Position: 38.7% above the Restaurants median (#169 of 331)
No single metric tells the full story. See the CAVA stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Cava Group Inc owns and operates a chain of restaurants. It operates a Mediterranean-inspired fast-casual restaurant brand offering menu items. The company's dips, spreads, and dressings are centrally produced and sold in grocery stores. The company's operations are conducted as two reportable segments: i) CAVA: It includes the operations of all company-owned CAVA restaurants, and ii) CAVA Foods: It includes the production of dips, spreads, and certain dressing bases used in CAVA restaurants as well as sales from the Company's consumer packaged goods business. The company generates the majority of its revenue from the CAVA segment.
62GF Score
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