Head to Head Review: Kona Grill (OTCMKTS:KONAQ) and CAVA Group (NYSE:CAVA)

Kona Grill (OTCMKTS:KONAQ) and CAVA Group (NYSE:CAVA) are both retail/wholesale companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, risk, profitability, earnings, institutional ownership and dividends.

Insider & Institutional Ownership

73.2% of CAVA Group shares are owned by institutional investors. 31.5% of Kona Grill shares are owned by insiders. Comparatively, 12.1% of CAVA Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Volatility and Risk

Kona Grill has a beta of 0.62, suggesting that its share price is 38% less volatile than the S&P 500. Comparatively, CAVA Group has a beta of 3.33, suggesting that its share price is 233% more volatile than the S&P 500.

Earnings and Valuation

This table compares Kona Grill and CAVA Group”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kona Grill	$156.94 million	0.01	-$31.97 million	N/A	N/A
CAVA Group	$845.22 million	18.36	$13.28 million	$0.41	331.93

CAVA Group has higher revenue and earnings than Kona Grill.

Analyst Recommendations

This is a summary of current ratings and price targets for Kona Grill and CAVA Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kona Grill	0	0	0	0	N/A
CAVA Group	0	8	8	0	2.50

CAVA Group has a consensus price target of $116.93, indicating a potential downside of 14.08%. Given CAVA Group’s higher probable upside, analysts clearly believe CAVA Group is more favorable than Kona Grill.

Profitability

This table compares Kona Grill and CAVA Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kona Grill	N/A	N/A	N/A
CAVA Group	5.04%	7.37%	4.25%

Summary

CAVA Group beats Kona Grill on 10 of the 11 factors compared between the two stocks.

About Kona Grill

Kona Grill, Inc. owns and operates upscale casual restaurants under the Kona Grill brand name. As of April 30, 2019, it operated 27 full-service restaurants in the United States. On April 30, 2019, Kona Grill, Inc., along with its affiliates, filed a voluntary petition for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the District of Delaware. The company is based in Scottsdale, Arizona.

About CAVA Group

CAVA Group, Inc. owns and operates a chain of restaurants under the CAVA brand in the United States. The company also offers dips, spreads, and dressings through grocery stores. In addition, the company provides online and mobile ordering platforms. Cava Group, Inc. was founded in 2006 and is headquartered in Washington, the District of Columbia.