Seeking Alpha

What to like about Chipotle

  • Chipotle (CMG +0.8%) is testing selling coffee in several Washington D.C. outlets in what Janney thinks could be a precursor to a national breakfast rollout.
  • Much of the bear thesis on Chipotle - demonstrated loudly by David Einhorn amongst others - was predicated on the Cantina Bell menu at Taco Bell clipping Chipotle's market share.
  • Most restaurant analysts don't think the Cantina Bell effect is occurring and Taco Bell's 2% gain in U.S. same-store sales during Q3 wasn't a home run.
Comments (4)
  • One of the problems with trying to pin a thesis on TB is that so many of the locations are the weird hybrid that is part Taco Bell and part Colonel Sanders. My store had posters in their windows for the Cantina Bell products but no idea what they were or how to make one. And though they are a hit with cash-strapped high schoolers, there is ONLY that advantage as the food is dramatically far from exceptional.

     

    The question to me has always been why isn't Qdoba doing better - the products are essentially the same as Chipotle's.
    11 Oct 2013, 11:03 AM Reply Like
  • Love Qdoba. My question would be "who's idea is it to test Coffee in a Mexican restaurant?" Somehow a hot cup of joe and a burrito are not an enticing combination.
    11 Oct 2013, 11:07 AM Reply Like
  • I can understand the appeal of hoping you can get enough breakfast business to help pay for the overall overhead. The burger places have been trying that for years but I think McD is about the only one that succeeds.

     

    Coffee/breakfast does sound like an idea hatched in a committee and they had to clear the room 15 minutes too soon - before someone actually let it sink in. I wonder why they think DC is a good test market?
    11 Oct 2013, 11:32 AM Reply Like
  • If these analysts actually compared and tasted a cantina bell burrito with Chipotle burrito, they wouldn't be writing nonsense. There's no real price difference and Chipotle wins on taste. The chemical tasting sauce in the Cantina Bell makes me wonder which Taco Bell exec has no taste buds.
    22 Oct 2013, 12:33 PM Reply Like
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