Chipotle (CMG) earnings preview: bright times ahead?

4:15 am ET, 25 Jul 2018

Chipotle Mexican Grill, Inc. (CMG) is expected to report earnings on July 26 after market close. The report will be for the fiscal quarter ending June 2018. Shares are trading at 456.59, up 1.2%.

What are CMG earnings expectations?  What news should investors be paying attention to? 

Investors are excited about the new CEO's (Brian Niccol) ability to reinvigorate the brand. Niccol and the overhauled executive team are saying all the right things to drive guest traffic in the near term (most notably, digital order pickup shelves, in-app delivery and catering functionality, and an afternoon taco/drink value platform), while shoring up the expense structure (a corporate reorganization that would eliminate multiple layers of corporate expenses and close 55-65 underperforming stores). 

The Chipotle brand could go a long way under Niccol's leadership, given several new products in the pipeline (quesadillas, nachos, avocado tostadas, chocolate milkshakes) that should stimulate consumer curiosity without adding undue operational complexity.  Other encouraging developments are the introduction of a rewards program, along with new ingredients, sauces, and portion sizes, as well as the possibility of technology-infused layouts. 

While Chipotle's new strategic vision is encouraging, this is not an overnight turnaround and it will take time for the brand to regain consumer trust.

It's worthwhile noting that Chipotle Mexican Grill, Inc. has a mixed history of beating analysts’ earnings estimates.  In the past four quarters, the company: 

  • Beat analyst EPS estimates by 16 cents ($2.32 actuals vs. $2.16 forecast) in FQ2’17;
  • Missed analyst EPS estimates by 10 cents ($1.46 actuals vs. $1.56 forecast) in FQ3’17;
  • Beat analyst EPS estimates by 2 cents ($1.34 actuals vs. $1.32 forecast) in FQ4’17;
  • Beat analyst EPS estimates by 59 cents ($2.13 actuals vs. $1.54 forecast) in FQ1’18.

For FQ2’18, EPS is expected to grow by 20% year-over-year to $2.78, while revenue is expected to grow 8% year-over-year to $1.26 billion.  

Over the last month, Chipotle Mexican Grill (CMG) returned -2.84%.

Chipotle Mexican Grill (CMG) forward P/E ratio is 38.85, and it’s high compared to its industry peers’ P/E ratios.

Chipotle Mexican Grill (CMG) short share of float is 12.7%. The stock is much more frequently shorted than the average industry, sector or S&P 500 stock.

Chipotle Mexican Grill, Inc. (CMG) average analyst price target ($379.04) is -16.98% below its current price ($456.59).

For the latest price and information on Chipotle Mexican Grill, please visit Finstead and search for "CMG price" or "CMG news".

Chipotle Mexican Grill (CMG): Can The Stock Move Higher?

5:17 pm ET, 22 Mar 2018

A new addition to the Chipotle management team caused CMG's stock prices to surge yesterday. After Chipotle hired Brian Niccol as its new CEO, it also brought Chris Brandt from a Mexican fast-food company to lead its marketing division in the upcoming month.

Chipotle's image was tarnished by a number of food safety scandals. Niccol’s actions are essential to restoring CMG's reputation.

The breakout of food-borne illness in 2015 caused a widespread aversion towards Chipotle. This led to a significant drop in the company's stock price from all-time highs by 50%.

But the declining trend changed in 2017 with a 15% rise in revenues. 

What is the prospect for Chipotle now?  According to Finstead Research, CMG’s price upside is negative.  

CMG’s average price target is $305, which is quite a bit less than its current stock price.

CMG has a high valuation (P/E ratio) compared to its peers. It lags only PBPB and HABT.


Our advice to potential investors—take the ‘wait and see’ approach.  

Chipotle Mexican Grill, Inc. (CMG) Stock Guide

Updated at: 2:29 pm ET, 17 Sep 2020

Before we start: if you're looking for CMG stock price, you can quickly find it out by visiting Finny and typing "CMG quote". If you're looking for a quick scoop on CMG stock (chart, price target, market cap, news and buy or sell analysis), go to Finny and look for "CMG". You'll get all this info in one place. Or you can just type "CMG news" to get the latest stock news.

Looking to buy or sell Chipotle Mexican Grill, Inc. (CMG)? Interested in getting the full scoop on CMG, including earnings and dividends, stock forecast, buy or sell analysis and key stats? If so, you came to the right place.

In this CMG stock guide, we'll address key questions about CMG, above and beyond what you can find on Yahoo Finance, Zacks, MarketWatch or Morningstar.

Here is what you'll be able to find in this guide:

Earnings and Dividends: earnings, earnings date, dividend rate and dividend yield;
Analyst Predictions: stock forecast and analyst ratings;
Analysis: Finny Score and buy or sell analysis;
Key Stats: revenue, market cap, revenue growth, profit margin, P/E ratio, P/B ratio, industry, sector, and number of employees.

And here is the list of questions we'll answer:
1. What are CMG earnings?
2. What is CMG stock forecast (i.e., prediction)?
3. CMG buy or sell? What is CMG Finny Score?
4. What are the reasons to buy CMG? Why should I buy CMG stock?
5. What are the reasons to sell CMG? Why should I sell CMG stock?
6. What are CMG key stats: revenue, market cap, revenue growth, profit margin, P/E ratio, P/B ratio industry, sector, and number of employees?

So let's start. Scroll down to the question that interests you the most.

Earnings and Dividends

1. What are CMG earnings?

CMG trailing 12-month earnings per share (EPS) is $9.02.

Analyst Predictions

2. What is CMG stock forecast (i.e., prediction)?

Based on CMG analyst price targets, CMG stock forecast is $1,251.56 (for a year from now). That means the average analyst price target for CMG stock is $1,251.56. The prediction is based on 35 analyst estimates.

The low price target for CMG is $751.00, while the high price target is $1,600.00.

CMG analyst rating is Hold.

Analysis

3. CMG buy or sell? What is CMG Finny Score?

#{finnyScore:13}Our quantitative analysis shows 1 reason to buy and 7 reasons to sell CMG, resulting in Finny Score of 13.

4. What are the reasons to buy CMG? Why should I buy CMG stock?

Here are the reasons to buy CMG stock:

  • We forecast that the fast-casual restaurant category will outpace the broader restaurant industry the next several years, driven by a compelling value proposition, attractive unit economics, and accommodation of evolving consumer preferences.
  • Chipotle was a pioneer in the movement toward naturally-raised proteins and organic produce. Though costlier to source and clouded by recent food safety issues, these are a key source of differentiation and pricing power.
  • A push into secondary concepts, including Pizzeria Locale and Tasty Made, can offer new layers of long-term growth.
  • CMG cash to debt ratio is 0.30, higher than the average industry (0.12) and sector (0.13) cash to debt ratio. See CMG cash to debt chart.

5. What are the reasons to sell CMG? Why should I sell CMG stock?

Let's look at the reasons to sell CMG stock (i.e., the bear case):

  • Fast-casual restaurant competition is escalating, and switching costs are nonexistent. Mexican concepts make up roughly one fourth of the $44 billion U.S. fast-casual industry.
  • Restaurant chains across all tiers are aggressively discounting to reverse decelerating traffic, increasing competition for fast-casual chains.
  • Chipotle must deal with evolving consumer preferences, wage increases, commodity cost volatility, and negative publicity tied to foodborne illnesses. Because there are fewer suppliers of naturally raised proteins, food shortages and unpredictable pricing are possible.
  • CMG quarterly revenue growth was -4.80%, lower than the industry and sector average revenue growth (1.25% and 0.78%, respectively). See CMG revenue growth chart.
  • CMG profitability is declining. The YoY profit margin change was -0.31 percentage points. See CMG profitability chart.
  • CMG Price/Book ratio is 22.51, which is high compared to its industry peers’ P/B ratios. See CMG forward Price/Book ratio chart.
  • CMG Price/Sales ratio is 6.83, which is high compared to its industry peers’ P/S ratios. See CMG forward Price/Sales ratio chart.
  • CMG PEG ratio (P/E adjusted for growth) is 5.46, which is high compared to its industry peers’ PEG ratios. See CMG PEG chart.
  • CMG short interest (days to cover the shorts) ratio is 3.24. The stock garners more short interest than the average industry, sector or S&P 500 stock. See CMG short interest ratio chart.
  • CMG Enterprise Value/Revenue multiple is 7.20, which is high compared to its industry peers’ Enterprise Value/Revenue multiples. See CMG Enterprise Value/Revenue chart.

Key Stats

6. What are CMG key stats : revenue, market cap, revenue growth, profit margin, P/E ratio, P/B ratio industry, sector, and number of employees?

Let's look at the key statistics for CMG:

Metrics CMG
Price $1,251.08
Average Price Target / Upside $1,251.56 / 0.04%
Average Analyst Rating Hold
Forward Dividend Yield 0.00%
Industry Restaurants
Sector Consumer Cyclical
Number of Employees 73,000
Market Cap $38.38B
Forward P/E Ratio 65.72
Price/Book Ratio 6.83
Revenue (TTM) $5.62B
YoY Quarterly Revenue Growth -4.80%
Profit Margin 4.55%

If you liked this analysis, check out Stock Guides for other stocks.

Follow Us