SixPackPablo

3 Comments

    • Chipotle Mexican Grill: A Close Look [view article]
      Hey, David, did a little searching and found that you had already explained the difference last year...so now the discount for B shares has increased even more...$130 for CMG and $103 for the B's as of 1/4/08 giving discount of 20%...wow, that's huge.

      "What's different about the B shares than the A shares (CMG, rather than CMG.B)? The B shares have ten times the voting power of the A shares (for every B share, you get ten times the vote you do with an A share). Both share classes have the same EPS, the same balance sheet, the same cash flow, the same financials, only the B shares have more voting rights. So the B shares are trading, or at least they should be, at a premium, right? You'd think so, but no. The A shares are currently trading at $58.98, several dollars above the B shares. Why is this? The best explanation that I can come up with is that it's just a plain goof-up by the market. The B shares should be trading at a premium to the A shares, McDonald's even said to expect the B shares to trade at a premium when they executed the share spin-off. So, I'm buying the B shares, because sooner or later, the market will realize its irrational ways. The separation from McDonald's will result in Chipotle losing some pricing benefits, but I this isn't anything that I think will hurt the company long-term."
      Jan 04 01:33 PM
    • Chipotle Mexican Grill: 4Q Expectations [view article]
      Any advantage to buying the B shares in CMG? They appear to be selling at 20% discount to CMG Common. To rephrase this, why the discount to begin with? Jan 04 01:28 PM
    • Chipotle Mexican Grill: 4Q Expectations [view article]
      any advantage to buying the B shares in CMG...they appear to be selling at 20% discount as of 1/4/08? why the discount? Jan 04 01:26 PM
Contribute an Article Become a Seeking Alpha Contributor