The Cheesecake Factory Incorporated Just Recorded A 8.4% EPS Beat: Here's What Analysts Are Forecasting Next

Last week, you might have seen that The Cheesecake Factory Incorporated (NASDAQ:CAKE) released its quarterly result to the market. The early response was not positive, with shares down 2.4% to US$63.91 in the past week. The result was positive overall - although revenues of US$956m were in line with what the analysts predicted, Cheesecake Factory surprised by delivering a statutory profit of US$1.14 per share, modestly greater than expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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Taking into account the latest results, the consensus forecast from Cheesecake Factory's 17 analysts is for revenues of US$3.76b in 2025. This reflects an okay 2.6% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to swell 11% to US$3.56. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$3.76b and earnings per share (EPS) of US$3.48 in 2025. So the consensus seems to have become somewhat more optimistic on Cheesecake Factory's earnings potential following these results.

Check out our latest analysis for Cheesecake Factory

The consensus price target was unchanged at US$65.47, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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. There are some variant perceptions on Cheesecake Factory, with the most bullish analyst valuing it at US$75.00 and the most bearish at US$47.00 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Cheesecake Factory's revenue growth is expected to slow, with the forecast 5.2% annualised growth rate until the end of 2025 being well below the historical 11% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 9.7% per year. Factoring in the forecast slowdown in growth, it seems obvious that Cheesecake Factory is also expected to grow slower than other industry participants.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Cheesecake Factory's earnings potential next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Cheesecake Factory's revenue is expected to perform worse than the wider industry. The consensus price target held steady at US$65.47, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Cheesecake Factory going out to 2027, and you can see them free on our platform here..

Don't forget that there may still be risks. For instance, we've identified 3 warning signs for Cheesecake Factory (1 is a bit unpleasant) you should be aware 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.