There's been a notable change in appetite for CAVA Group, Inc. (NYSE:CAVA) shares in the week since its full-year report, with the stock down 12% to US$95.03. It looks like a credible result overall - although revenues of US$964m were what the analysts expected, CAVA Group surprised by delivering a (statutory) profit of US$1.10 per share, an impressive 117% above what was forecast. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for CAVA Group

Taking into account the latest results, the consensus forecast from CAVA Group's 14 analysts is for revenues of US$1.19b in 2025. This reflects a major 23% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to plunge 53% to US$0.53 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$1.19b and earnings per share (EPS) of US$0.62 in 2025. So there's definitely been a decline in sentiment after the latest results, noting the substantial drop in new EPS forecasts.

It might be a surprise to learn that the consensus price target fell 14% to US$129, with the analysts clearly linking lower forecast earnings to the performance of the stock price. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values CAVA Group at US$175 per share, while the most bearish prices it at US$100.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the CAVA Group's past performance and to peers in the same industry. The period to the end of 2025 brings more of the same, according to the analysts, with revenue forecast to display 23% growth on an annualised basis. That is in line with its 23% annual growth over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 9.7% per year. So although CAVA Group is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that in mind, we wouldn't be too quick to come to a conclusion on CAVA Group. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for CAVA Group going out to 2027, and you can see them free on our platform here..

We don't want to rain on the parade too much, but we did also find 2 warning signs for CAVA Group (1 doesn't sit too well with us!) that you need to be mindful of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.