The restaurant stock has a volatile history of post-earnings moves
CAVA Group Inc (NYSE:CAVA) has been dubbed the 'next Chipotle,' with the Mediterranean fast casual chain vaulting up the charts since its trading debut in June 2023. The stock has struggled so far in 2025, down 13%, but could be poised for a big move this week as the company's first quarter earnings loom.
CAVA has a varied history of post-earnings moves. The stock only shed 0.3% after its earnings report in late February, but melted up by nearly 20% after its late August report. Overall, the stock averaged a post-earnings move, regardless of direction, of 6.2% after the last eight reports. This time around, the options market is pricing in a larger-than-usual post-earnings swing of 14.6%.
Leading up to the event, CAVA shares have been trading in a tight range, at the bottom of a channel of lower lows starting from their Nov. 13 all-time high of $172.42. Since early March, the stock has also tested its 320-day on numerous occasions.
There's intriguing short squeeze potential to monitor; short interest has fallen off 10% in the two most recent reporting periods, yet 9.3% of the stock's total available float remains sold short.
The equity has outperformed options traders' volatility expectations over the last 12 months, making this an excellent opportunity to weigh in with options. This is per its Schaeffer's Volatility Scorecard (SVS) of 84 out of 100.