Shares of restaurant chain Cava hit a record high on Wednesday, surging over 16% to $167.50 in early trading after the company exceeded quarterly earnings estimates. Strong demand for its pita chips and premium grilled steaks fueled the performance, leading Cava to raise its annual forecasts for the third time this year. Cava’s stock has seen substantial gains, tripling in value throughout 2024. Fast-casual dining chains, including Cava, Shake Shack, and Chipotle, have capitalized on a shift in consumer behavior, with customers increasingly viewing these options as better value compared to traditional fast-food chains. TD Cowen analyst Andrew Charles noted this shift toward fast-casual dining as middle-income consumers seek quality experiences without premium costs.

Cava saw a 28.4% increase in customer visits up until September, while major fast-food chains like McDonald's and Burger King reported slight declines, according to Placer.ai data. After the results, multiple brokerages raised their price targets for Cava, with Stifel setting the highest at $175, citing strong growth opportunities. Cava's expanded loyalty program, launched in early October, contributed significantly to its sales, and same-restaurant sales rose by 18.1%, driven by a blend of increased guest traffic and strategic menu adjustments. CEO Brett Schulman shared plans for further growth, with expansions into South Florida next year and additional Midwest markets by 2025.