I make a stew with fresh favas blanched and peeled. I add them with onions, pancetta, peas and artichoke hearts. And a little oregano. After it's all cooked I add some fresh lemon juice and lots of pepper before serving. It's a Roman recipe.

For fresh favas I usually do as merrill suggests, generally popping them out of the inner skin, especially if they are larger/older beans. It's easier to pop them out after the blanching step, which is why, even if the beans are destined for a sautee in olive oil I always blanch first.
With the beans fresh from my garden, I have taken to grilling them whole, then eating like edamame where popping the beans out of the pods is part of the "fun" of eating them (aka I don't have to shell all of them for any guests).

There are lots of different ways to cook favas, but the simplest is probably to shell them and blanch the beans in boiling water for about a minute. Some people prefer to pop the beans out of their skins before eating, while others don't have the patience. Once they're cooked, you can toss them into salads pr pasta, mash them with olive oil and salt and pepper and spread on crostini -- the sky's the limit!