KeyBanc initiated coverage on CAVA with an "overweight" rating
Restaurant stock CAVA Group Inc (NYSE:CAVA) was last seen up 3.3% at $85.06, after KeyBanc initiated coverage with an "overweight" rating and $100 price target. The firm pointed to the company's lack of direct competitors, saying it had the potential to become the "Chipotle of Mediterranean food."
On the charts, CAVA is still seeing pressure from a confluence of moving averages ranging between the 40-day to 100-day trendlines. The shares are down 24.6% year-to-date, having yet to recover from their February losses.
Options bulls are blasting CAVA after today's news. So far, 23,000 calls have been exchanged -- quadruple the intraday average volume -- in comparison to just 2,228 puts. Expiring tomorrow with the holiday-shortened week, the weekly 7/3 86-strike call is the most popular, followed by the weekly 7/11 90-strike call, with new positions opening at both.
Calls have been more popular than usual ahead of today too. The stock's 50-day call/put volume ratio of 2.78 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks higher than 91% of readings from the past year.
Meanwhile, short interest represents 10% of the security's available float. It would take shorts three days to cover their bets, at CAVA's average pace of trading.