CAVA Group, Inc. (CAVA)

The solvency ratios for CAVA Group, Inc. indicate a significant reliance on data suggesting minimal or no debt relative to total assets, capital, and equity, as evidenced by the debt-to-assets, debt-to-capital, and debt-to-equity ratios consistently reported at zero across all periods from December 31, 2020, through December 31, 2024. Such ratios imply that the company has likely operated with little to no interest-bearing liabilities or has not reported these liabilities within the scope of the provided data.

Conversely, the financial leverage ratio presents a more nuanced picture. It fluctuates over the period, starting at 2.00 in December 2020, decreasing to 1.35 in December 2021, then rising to 3.06 in December 2022, followed by slight reductions to 1.72 in December 2023, and further to 1.68 in December 2024. The variations in this ratio suggest periods of increased leverage capacity or perceived risk, notably peaking at 3.06 in 2022, which may correspond to a temporary increase in debt levels or changes in the equity base, even if the other ratios do not reflect debt accumulation.

Overall, the data implies that CAVA Group, Inc. primarily operates with low or negligible debt, maintaining a conservative capital structure in terms of leverage. The fluctuations in the financial leverage ratio could reflect operational or strategic adjustments affecting the company's risk profile, although the absence of debt ratios reinforces a predominantly debt-free capital structure during the analyzed period.

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Coverage ratios

The interest coverage ratio for CAVA Group, Inc. exhibits significant fluctuation over the analyzed period. As of December 31, 2020, the ratio is not available, indicating either a lack of interest expense or EBITDA data for that year. By December 31, 2021, the ratio declines sharply to -6.75, suggesting that the company's earnings before interest, taxes, depreciation, and amortization (EBITDA) were insufficient to cover interest expenses, possibly resulting in negative EBITDA or extremely low interest payments relative to earnings. The deterioration continues into 2022, with the interest coverage plunging to -1,252.06, indicating severe financial strain and a substantial inability to meet interest obligations, potentially reflecting negative EBITDA and high interest expenses or both.

In contrast, the data for December 31, 2023, again indicates a lack of availability, implying a similar absence of meaningful interest coverage measurement or no interest expense incurred. The most recent data point for December 31, 2024, presents a substantial improvement, with the ratio reaching 2.64. This indicates that, at that time, CAVA Group, Inc. had restored a modest capacity to cover its interest expenses with its earnings, implying better operational performance or restructuring that led to positive EBITDA levels sufficient to support interest obligations to some extent.

Overall, the trend displays a period of severe financial distress in 2021 and 2022, with negative interest coverage ratios reflecting operational challenges or high indebtedness. The apparent rebound in 2024 suggests a possible turnaround or improved financial management, though the ratio remains relatively modest, signaling room for further strengthening of the company’s ability to comfortably cover its interest expenses.