Chipotle Mexican Grill (CMG) is a stock that, like P&G (PG) and Kraft (KFT), would never show up on my deep value screeners. What I really like about Chipotle is not only the food (I've been hooked for more than 6 years now), but also the fact that the stock barely felt the recession last year - apparently everyone else is hooked too.
I didn't buy this during the Oct-Mar buying opportunity because 1) since the IPO I have considered this stock to be priced out of my comfort range, and 2) there were other opportunities that I was exploring at the time, to include value plays that were more attractively priced and less volatile. All in all, given my portfolio's performance, and assuming I did not buy at CMG's actual low, this stock has performed in line with the rest of my portfolio since March, i.e., I do not regret 'missing' this opportunity back then.
That being said, it is obviously pricier now. I am more comfortable with the volatility (I may have to chalk this up to irrationality - the price increasing/moderation has made me more comfortable with owning the stock). More importantly, it has grown throughout its public history, despite factors that have limited companies that are either better positioned or more well-known.
Outside of being expensive compared to book, it has everything else going for it, low debt, low-to-no intangibles, clean, focused, and easy-to-digest financials, and given its outstanding growth and what I see as outstanding growth prospects (I am looking at 10-15% minimum over 10 years), I figured it was about time I took a bite.
Regarding analyst ratings, I find it typical that the consensus view since March was 'sell' to 'strong sell' as this stock doubled. I agree that valuation-wise, it is not that attractive - this would be a Philip Fisher play versus a Ben Graham play. Perhaps that is why I've waited so long before going into this...that and I was more or less fully invested already by March. That has since changed, and I am looking again for opportunity.
Strategy going forward will be a DCA type strategy - as the price goes down, I will be more and more inclined to increase my position by orders of 2. This strategy has served me very, very well in the past, to include the recent Oct-Mar buying opportunity.
I plan on checking the performance of this stock often, i.e. whenever I take a bite out of one of those 'food logs.'
