Zacks Investment Research Downgrades Chipotle Mexican Grill (CMG) to Hold

Share on StockTwits

Chipotle Mexican Grill (NYSE:CMG) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a research note issued to investors on Monday.

According to Zacks, “Shares of Chipotle have outperformed the industry over the past year. We expect the company to remain on this growth trajectory after fourth-quarter 2018 earnings surpassed the Zacks Consensus Estimate. Adjusted earnings grew 28.4% from the year-ago quarter, driven by higher revenues and lower food costs. Despite having a good share of negative publicity from a food-borne illness, Chipotle’s viable business strategy and the appointment of Brian Niccol significantly helped in 2018. For 2019, management expects comps to grow in the mid-single-digit range and expects to open 140-155 restaurants. Chipotle's increased focus on food safety and enhancing customer experience, along with various sales-building initiatives, is likely to drive the top line while high costs and intense competition may be concerning in the future.”

A number of other equities analysts also recently issued reports on CMG. Wells Fargo & Co cut their target price on Chipotle Mexican Grill from $418.00 to $415.00 and set a “market perform” rating for the company in a research note on Tuesday, October 16th. Gordon Haskett initiated coverage on Chipotle Mexican Grill in a research note on Thursday, October 18th. They issued an “underperform” rating and a $385.00 price objective for the company. Royal Bank of Canada raised Chipotle Mexican Grill from a “sector perform” rating to an “outperform” rating and raised their price objective for the company from $450.00 to $510.00 in a research note on Monday, October 22nd. UBS Group set a $370.00 price objective on Chipotle Mexican Grill and gave the company a “sell” rating in a research note on Monday, October 22nd. Finally, Piper Jaffray Companies set a $550.00 price objective on Chipotle Mexican Grill and gave the company a “buy” rating in a research note on Monday, October 22nd. Nine research analysts have rated the stock with a sell rating, fifteen have assigned a hold rating, twelve have assigned a buy rating and one has given a strong buy rating to the company. Chipotle Mexican Grill currently has an average rating of “Hold” and a consensus price target of $501.39.

Shares of CMG stock traded up $19.96 during trading hours on Monday, reaching $602.73. 33,514 shares of the company’s stock were exchanged, compared to its average volume of 859,622. The company has a market cap of $16.19 billion, a price-to-earnings ratio of 66.51, a price-to-earnings-growth ratio of 2.72 and a beta of 0.60. Chipotle Mexican Grill has a 1 year low of $247.51 and a 1 year high of $606.00.

Chipotle Mexican Grill (NYSE:CMG) last issued its earnings results on Wednesday, February 6th. The restaurant operator reported $1.72 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $1.38 by $0.34. The business had revenue of $1.23 billion during the quarter, compared to the consensus estimate of $1.20 billion. Chipotle Mexican Grill had a return on equity of 17.64% and a net margin of 3.63%. The company’s revenue for the quarter was up 10.4% on a year-over-year basis. During the same period in the prior year, the business posted $1.34 EPS. Analysts expect that Chipotle Mexican Grill will post 12.16 earnings per share for the current year.

Hedge funds have recently modified their holdings of the business. Renaissance Technologies LLC boosted its position in shares of Chipotle Mexican Grill by 255.0% during the third quarter. Renaissance Technologies LLC now owns 792,000 shares of the restaurant operator’s stock worth $359,980,000 after buying an additional 568,900 shares during the period. Capital International Investors boosted its position in shares of Chipotle Mexican Grill by 220.1% during the third quarter. Capital International Investors now owns 738,410 shares of the restaurant operator’s stock worth $335,622,000 after buying an additional 507,700 shares during the period. Baillie Gifford & Co. acquired a new position in shares of Chipotle Mexican Grill during the third quarter worth approximately $229,937,000. Jennison Associates LLC boosted its position in shares of Chipotle Mexican Grill by 128.5% during the third quarter. Jennison Associates LLC now owns 830,269 shares of the restaurant operator’s stock worth $377,374,000 after buying an additional 466,849 shares during the period. Finally, AQR Capital Management LLC boosted its position in shares of Chipotle Mexican Grill by 2,464.4% during the third quarter. AQR Capital Management LLC now owns 218,202 shares of the restaurant operator’s stock worth $99,177,000 after buying an additional 209,693 shares during the period. Institutional investors own 91.25% of the company’s stock.

Chipotle Mexican Grill Company Profile

Chipotle Mexican Grill, Inc, together with its subsidiaries, operates Chipotle Mexican Grill restaurants. As of September 30, 2018, it operated 2,424 Chipotle restaurants in the United States, as well as 37 international Chipotle restaurants. The company was founded in 1993 and is headquartered in Newport Beach, California.

Further Reading: Rule of 72

Get a free copy of the Zacks research report on Chipotle Mexican Grill (CMG)

For more information about research offerings from Zacks Investment Research, visit Zacks.com

Analyst Recommendations for Chipotle Mexican Grill (NYSE:CMG)

Receive News & Ratings for Chipotle Mexican Grill Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Chipotle Mexican Grill and related companies with MarketBeat.com's FREE daily email newsletter.

Leave a Reply