CAVA Group, Inc. (CAVA)

Return on total capital

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Earnings before interest and tax (EBIT)	US$ in thousands	43,436	31,422	-58,847	-32,464	72,400
Long-term debt	US$ in thousands	—	—	—	—	—
Total stockholders’ equity	US$ in thousands	695,566	570,802	213,805	269,287	870,900
Return on total capital		6.24%	5.50%	-27.52%	-12.06%	8.31%

December 31, 2024 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $43,436K ÷ ($—K + $695,566K)
= 6.24%

The return on total capital for CAVA Group, Inc. experienced significant fluctuations over the analyzed period from December 31, 2020, to December 31, 2024. In 2020, the company reported a return of 8.31%, indicating a relatively healthy utilization of its total capital during that year.

However, by the end of 2021, this metric deteriorated sharply to -12.06%, reflecting a transition to a negative return, which suggests that the company's operations or investments during that period were not generating sufficient income relative to its total capital base, potentially indicative of operational challenges, increased costs, or strategic setbacks.

The downward trend continued into 2022, with the return further declining to -27.52%. This substantial negative figure signals a significant deterioration in the company's ability to generate returns from its total capital, possibly due to adverse market conditions, decreased profitability, or increased capital costs.

Starting from 2023, there was a reversal in the trend, with the return increasing to 5.50%, suggesting an improvement in operational efficiency or profitability that enabled the company to move back into a positive territory. In 2024, this recovery persisted, with the return slightly increasing to 6.24%, further indicating ongoing positive momentum in leveraging its capital resources effectively.

Overall, the period reflects a cycle of initial profitability, followed by a notable decline into significant negative returns, and subsequent recovery towards positive returns. This pattern underscores the company's resilience and potential strategic adjustments that have begun to restore its ability to generate returns on its total capital base.