Chipotle Mexican Grill, Inc.NYSE
Chiptopia's Incremental Economics Should Jumpstart Sales And Profits
Long Hill Road Capital • 17 Comments
Long Hill Road Capital • 17 Comments
Chipotle: Its Market Is Smaller Than Investors Believe, Valuation Implies 30%+ Downside
Hayden Cole • 61 Comments
Hayden Cole • 61 Comments
Tue, Dec. 6, 10:56 AM
- Chipotle (CMG -7%) says it will consider firing off some menu increases next year to help it offset wage pressure.
- Execs indicated an effort will me made to keep a lid on labor costs by setting a hiring freeze.
- In a pair of tough observations, the presenters said the company is "nervous" about hitting its guidance and that the longer lines at stores are a result of slower throughput (line speed) not just a boost in actual traffic.
- "I'm not satisfied with the rate of recovery and the quality of the restaurant experience," said co-CEO Steve Ells.
- A very interesting development will be the makeup of the new Chipotle board with Bill Ackman breathing down the restaurant operator's neck. An announcement is expected shortly.
- Sources: Bloomberg and Reuters.
Tue, Dec. 6, 9:02 AM
Mon, Dec. 5, 1:58 PM
- Kroger (KR -1.3%), Target (TGT -1.2%) and Wal-Mart (WMT -1%) are all lower on the day after Amazon introduces its line-free Amazon Go concept in Seattle.
- It's unclear how wide Amazon plans to go with the brick-and-mortar store chain which utilizes a grab-and-go experience for consumers with payments run through a combination of scanners, sensors, apps and AI.
- In the initial phase, Amazon Go will feature ready-to-eat-meals as it jumps into a category that skirts close to the territory of Whole Foods Market (WFM), Chipotle (CMG +0.7%) and other fresh food sellers.
- Previously: Amazon introduces new store concept with no checkout lines (Dec. 5)
- Previously: Cowen and Company's bullish on Amazon Go (Dec. 5)
Mon, Dec. 5, 8:04 AM
- One of the more interesting conferences in the retail sector during Q4 starts off today in New York City. The Barclays 2016 Eat, Sleep, Play - It's All Discretionary Conference will feature execs talking 2017 strategy, as well as doling out some post-election and post-Black Friday insights.
- Presenters today include The Chef's Warehouse (NASDAQ:CHEF), Smart & Final Stores (NYSE:SFS) and Sprouts Farmers Market (NASDAQ:SFM).
- Tuesday presenters include Chipotle (NYSE:CMG), The Cheesecake Factory (NASDAQ:CAKE), Yum Brands (NYSE:YUM), Kroger (NYSE:KR), Jack in the Box (NASDAQ:JACK), Domino's Pizza (NYSE:DPZ), Marriott International (NYSE:MAR) and Wingstop (NASDAQ:WING).
- Discretionary-focused ETFs: XLY, XRT, VCR, RTH, RETL, FXD, FDIS, RCD, PEZ, PMR, PSCD, CNDF, FTXD, JHMC.
Tue, Nov. 29, 12:46 PM
- SunTrust Robinson Humphrey says "dramatically lower" avocado prices could help lift profit at Chipotle (CMG -0.5%) this quarter and potentially into 2017.
- Food costs rose 210 bps to 35.1% of sales for Chipotle in Q3, due in part to avocado pricing.
- Analyst Jake Bartlett still has a Q4 EPS estimate of $0.95 for CMG vs. the Street consensus of $1.06.
- Source: Bloomberg
Fri, Nov. 18, 7:38 AM| Fri, Nov. 18, 7:38 AM | 6 Comments
Thu, Nov. 17, 6:59 AM
- Guggenheim lowers Chipotle (NYSE:CMG) to a Sell rating after having the restaurant stock set at Neutral.
- The investment firm lines up a price target of $315 on Chipotle vs. the 52-week range of $352.96 to $614.70.
- There are 7 Sell ratings on CMG now from Wall Street firms, compared to 11 Buy ratings.
- CMG -1.02% premarket to $398.79.
Fri, Nov. 11, 11:57 AM
- Chipotle Mexican Grill (CMG +1.5%) says its Tasty Made offshoot burger restaurant that opened last month in Ohio is enjoying "strong" sales.
- CMG hopes Tasty Made, which is touting responsibly raised beef, could become a bright spot for a company still reeling from a food-safety crisis, as Q3 same-store sales plunged 21.9%.
- Tasty Made's Yelp reviews are mediocre but improving over the past two weeks; it is currently approaching a three-star rating, out of five.
Fri, Nov. 4, 5:35 PM
- Chipotle Mexican Grill (NYSE:CMG) and Pershing Square's Bill Ackman have signed an agreement to engage in confidential discussions, a sign that change could be coming for the company without a costly and drawn-out proxy contest, Reuters reports.
- Ackman, who took a nearly 10% stake in CMG two months ago and has not disclosed his strategy, wants multiple board seats with the aim of improving food safety and marketing, according to the report.
- Two major investors this week reportedly urged CMG shareholders to name an independent chairman, replacing founder and co-CEO Steve Ells, and hope to take up the issue the next annual meeting.
- CMG shares have lost 40% since a series of food borne illness outbreaks were linked to the chain late last year.
Fri, Nov. 4, 10:32 AM
- Avocado prices are due to drop sharply in the U.S. after a work stoppage in Mexico ended. Prices hit a record high recently due to strong demand, an extended drought in California and the labor strife in Mexico.
- "Avocados are flowing freely and abundantly into this country," says an avocado trade group representative.
- Companies impacted by avocado pricing include Calavo Growers (CVGW +0.6%) on the selling side and Chipotle (CMG -0.6%) and Panera Bread (PNRA -0.8%) on the buying side.
Tue, Nov. 1, 12:11 PM
- The reviews of Tasty Made are mixed at best, according to an aggregation of early samplers posted by Delish.com.
- The pricing from Tasty Made of $3.75 for a hamburger and $3.95 for a cheeseburger seems to be drawing the sharpest criticism on the new Chipotle (CMG -0.7%) concept.
- Tasty Made and Pizzeria Locale are the two "seed concepts" that Chipotle plans to grow, while the 15-unit ShopHouse Southeast Asian Kitchen chain is under a strategic review.
Mon, Oct. 31, 3:49 PM
- Chipotle (CMG -2.4%) drifts lower again to a session low of $360.15. The restaurant stock is also at a new multi-year low.
- It's been exactly one year since the restaurant chain fell victim to a devastating E. coli outbreak.
- Looking ahead, SA contributor Kevin Wenck notes the company's decision to shutter ShopHouse takes some of the punch out if its growth potential.
- "The failure of the ShopHouse concept as an expansion vehicle shows the limitations and lack of capabilities of CMG management," he adds.
Mon, Oct. 31, 3:42 PM
Fri, Oct. 28, 2:46 AM
- Chipotle (NYSE:CMG) has turned to high-profile investment bankers and lawyers to help defend itself against activist investor Bill Ackman, although he hasn't yet publicly made any demands since becoming Chipotle's second-largest shareholder last month.
- According to Reuters, Goldman Sachs and Morgan Stanley, as well as law firm Wachtell, Lipton, Rosen & Katz, are now working for the U.S. restaurant chain.
Thu, Oct. 27, 12:38 PM
- Chipotle (CMG -0.6%) launched its Tasty Made business today, with a restaurant opening in Lancaster, Ohio complete with a drive-through window.
- The company is keeping it simple with the new chain by only selling burgers, fries and shakes.
- Similar to Five Guys and In-N-Out Burger, burger patties at Tasty Made are cooked fresh, instead of using the frozen fast-food model. The new concept isn't anything for Shake Shack (NYSE:SHAK) and Habit Restaurants (NASDAQ:HABT) to worry about just yet, but the chains will keep a watch on the Tasty Made roll-out.
- Now who in Lancaster can tell us how a Tasty Made burger rates?
Wed, Oct. 26, 8:34 AM
- Execs with Chipotle (NYSE:CMG) tried to accentuate the positive during the firm's conference call yesterday.
- The company plans to market chorizo pretty hard after the new menu option accounted for 7% of entree sales in Q3. Repeat traffic from chorizo lovers is expected in Q4.
- There is also still plenty of upside seen with digital ordering as the chain tests out a new line at stores.
- Challenges that are still in front of the company outside of the traffic falloff include the higher level of wages and the huge spike in avocado prices.
- Chipotle will pull the plug on the ShopHouse concept after seeing disappointing results.
- Chipotle earnings call transcript
- Previously: Chipotle Mexican Grill misses by $1.03, misses on revenue (Updated) (Oct. 25)
- Previously: Comparable sales fall 22% at Chipotle (Oct. 25)
- CMG -3.37% premarket to $392.00.