The shares of Mediterranean food-focused restaurant chain Cava tumbled on Tuesday after CEO Brent Schulman and several other key executives disclosed a sale of a sizable chunk of their stock holdings.
In a U.S. Securities and Exchange Commission (SEC) filing made on Monday, Schulman revealed that he sold 210,504 shares of Cava, netting $24.87 million in the process. Cava co-founder Ted Xenohristos, who also serves as chief concept officer for the company, parted with 98,490 shares to bank $12.387 million.
Additionally, chief financial officer Patricia Toliva and board member David Bosserman each sold 5,000 shares.
The stock sale by Cava’s key executives came after a recent rally prompted by a better-than-expected earnings report released last week. It included a 35.05% year-over-year growth in revenue and a 201.9% increase in net income compared to the same period last year. The company’s stock then surged to $127.48 per share at one point on Monday, marking more than 200% gain year-to-date.
On Tuesday, Cava’s shares went as low as $114.60 before recovering slightly later in the day and closing at $118.10.
Investors are likely concerned that Cava’s key insiders believe the stock has reached its high point and has nowhere else to go but down.