Chipotle has a small market share. They don’t have nearly as many stocks as other companies do, and that ends up impacting the overall pricing that you pay for the stock. When companies have quite a few, the pricing may be lower, and then some companies have a limited number of stocks, and you can expect the pricing to be very high.
Full Answer
Is it too late to buy Chipotle stock?
While the shares have done well, Regan said Chipotle is still in a recovery phase, so it isn’t too much of a stretch to think that still more upside can exist. The chain continues to open stores and increase sales at those already operating. Valuation has been one of the biggest knocks against the stock throughout its rally.
Should I invest in Chipotle stock?
Should You Invest in Chipotle Mexican Grill Stock? The past few years, and even this past quarter, have been amazing for Chipotle. However, given the cost investors must pay for this growth, might ...
Should you buy the dip in Chipotle stock?
[4/4/2021] Should You Buy The Dip In DoorDash Stock? DoorDash stock has declined ... more valuable than major restaurants including Chipotle and Yum Brands. Is this valuation justified?
Does Chipotle make money?
Yes, Folks, Chipotle Makes Money. Okay, so does Chipotle make money? The answer to that question is definitely yes; it just does not make nearly enough money to justify that $650 stock price. The financial numbers indicate that Chipotle’s business model is certainly profitable although not necessarily for investors.
Why is Chipotle stock so valuable?
Chipotle has always had a knack for growth, despite operating in a market with heavy competition. While other restaurants large and small struggled to adapt to the coronavirus lockdown, Chipotle was already in the right place at the right time to properly serve a need for sanitary food.
Is Chipotle publicly owned?
On January 26, 2006, Chipotle made its initial public offering (IPO) after increasing the share price twice due to high pre-IPO demand. In its first day as a public company, the stock rose exactly 100%, resulting in the best U.S.-based IPO in six years, and the second-best IPO for a restaurant after Boston Market.
Will Chipotle split its stock?
So if you've been eyeballing your online broker wishing that Chipotle would consider a stock split to make purchasing shares more affordable, the bad news is that, well, it's probably not going to happen.
Who owns the most Chipotle stock?
T. Rowe Price Associates, Inc.Top 10 Owners of Chipotle Mexican Grill IncStockholderStakeShares ownedT. Rowe Price Associates, Inc. (I...9.88%2,761,704The Vanguard Group, Inc.8.51%2,379,400BlackRock Fund Advisors4.83%1,349,879Edgewood Management LLC4.51%1,262,1986 more rows
Why did McDonald's sell its shareholding in Chipotle?
Steve Easterbrook(pictured below), the McDonald's then-CEO, said that investment in Chipotle and the other businesses were a distraction to McDonald's. Company executives wanted to put 100 percent of their efforts to grow the McDonald's brand, thus they sold all of the shares.
Who owns Chipotle now?
An archived webcast will be available approximately one hour after the end of the call. Steve Ells , Founder, Chairman and CEO, started Chipotle with the idea that food served fast did not have to be a typical fast food experience.
What happens in a stock split?
A stock split happens when a company increases the number of its shares to boost the stock's liquidity. Although the number of shares outstanding increases by a specific multiple, the total dollar value of all shares outstanding remains the same because a split does not fundamentally change the company's value.
What is the purpose of splitting stock?
Companies typically engage in a stock split so that investors can more easily buy and sell shares, otherwise known as increasing the company's liquidity. Stock splits divide a company's shares into more shares, which in turn lowers a share's price and increases the number of shares available.
Why do companies split stock?
A stock split is often a sign that a company is thriving and that its stock price has increased. While that's a good thing, it also means the stock has become less affordable for investors. As a result, companies may do a stock split to make the stock more affordable and enticing to individual investors.
How much of Chipotle is owned by McDonald's?
90%While the Golden Arches initially took only a minority stake, by the time Chipotle went public in 2006, McDonald's owned more than 90% of the company. McDonald's no longer owns any shares of Chipotle (something it must also now regret), but the impact on Ells' ownership stake was permanent.
Can you buy a Chipotle franchise?
As of today, all Chipotle Mexican Grill restaurants are company-owned and the company doesn't offer franchising at this time.
How much is Chipotle franchise?
ExpendituresEstimated Amount or Estimated Low-High RangeChipotle Franchise Fee (if they franchised)$20,000 to $25,000Real Estate Purchase or Lease(may vary substantially based upon the location)Site Preparation and Completion Costs$150,000 to $400,000Construction Costs$550,000 to $700,00010 more rows•Jun 23, 2022
How many restaurants did chipotle have in the first quarter?
Chipotle finished the first quarter with 2,803 restaurants and an average unit volume (AUV), or sales per restaurant, of $2.3 million, with a restaurant-level operating margin of 22.3%. Chipotle's ability to add new restaurants while improving the two other metrics above will be the most important factor in determining the company's performance 10 ...
How much does chipotle get in AUVs?
Therefore, it seems reasonable that Chipotle will get to at least $3 million in AUVs, and potentially up to $3.5 million in average volumes.
Is chipotle a growth company?
Ten years is a long way, but the company will likely still be a growth company -- Chipotle has little direct competition in burritos or Mexican fast-casual in general, and there's still a huge international market for it to penetrate. In fact, management noted recent success in Canada, where it now sees room for at least a few hundred restaurants, and the company has recently introduced a number of new features that could boost growth ahead of the path outlined above. Those include Chipotlanes, its loyalty program, new menu items like quesadillas, and further growth in digital and delivery.
Chipotle's share-price history
As you can see in the chart above, Chipotle has posted strong returns for long-term shareholders, even if the stock has given back much of its overall gains over the past year. Its rise since its 2006 spinoff from McDonald's amounts to more than 800%, giving investors who put $1,000 into the stock a position worth more than $9,000 today.
Chipotle's rise and fall
In response, Chipotle started looking at new ways to grow. The introduction of the ShopHouse Southeast Asian Kitchen concept introduced Chipotle shareholders to the idea that the restaurant chain could grow by branching out in a number of different directions, taking its high-quality food experience into different genres of food.
Where will Chipotle go from here?
To recover, Chipotle has taken several actions. A rewards program has tried to give loyal customers an incentive to keep coming to the restaurant chain, and an expansion to its menu to add chorizo was also designed to boost interest. Yet the fast-casual giant hasn't provided much guidance on how well those initiatives have worked recently.
How much has chipotle stock increased in 2019?
Chipotle’s stock, in fact, has soared more than 93% in 2019, compared with the S&P 500 index’s SPX, +0.77% 20% gain.
Who is the CEO of chipotle?
Everything was going the wrong way for Chipotle when CEO Brian Niccol, a former head honcho at Taco Bell, took the reins in March 2018. The fast-casual chain couldn’t seem to shake off the damage done to its previously strong reputation, financial results and stock-market returns by a rash of food-borne-illness outbreaks nearly 2½ years earlier.
What is the chipotle stage gate?
Chipotle turned its focus to food safety in the months after the illness outbreaks were reported. The company adopted a “stage gate ” system that tests, analyzes and gathers feedback about menu ideas to determine what proceeds to a national rollout.
Why did Alibaba stock jump?
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Is Carne Asada available at Chipotle?
Carne asada is available for a limited time. Chipotle. The new approach seems to be yielding more successes for a company that, while it might have freely explored a multitude of ideas, rarely — as compared with rival counter-service chains and their frequent introductions of seasonal and limited-run items, rarely changed its menu.
Is chipotle making news?
There’s more reason, on this front, to go to Chipotle.”. Moreover, Chipotle is making news with its newer food items. “They’re in the news for the wrong reasons a lot less,” said Kalinowski. “So people can focus on the positive, like [that] the food is tasty and the service is quick.”.
When did chipotle go public?
Chipotle went public at $22 in January 2006, and its share price doubled by the end of its first day of trading. That was the first time in more than five years that a U.S.-based debutante had at least doubled on its first day.
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This restaurant innovator has been a winner for investors in the past and could very well continue its success into the future
Chipotle Mexican Grill ( CMG -0.13% ) has made investors rich over the years by pioneering the fast-casual restaurant concept using one of the world's most popular cuisines. The stock has more than tripled over the past five years, trouncing the S&P 500 during the same time.
Digital push
Last year was extremely difficult for most restaurants, as state and local governments prohibited indoor dining service for some time to curb the spread of the coronavirus. Chipotle's second-quarter results reflected this -- and showed a way forward.
NYSE: CMG
In April, the first full month of the shutdowns, Chipotle's comparable-store sales (or comps) decreased 24.4% from the same month in 2019. But this metric turned positive in June on the strength of Chipotle's digital infrastructure.
New restaurants
Chipotle's total restaurant count is 2,710, so investors must be wondering how many more locations the company can open. Even after a disruptive year, management still believes that longer term, it can more than double its domestic store count. This would mean a total of more than 5,000 locations in the U.S.
What about valuation?
For any stock to make millionaires out of its owners, it must be held for a long time and needs to be selling at an attractive valuation that can provide outsized future returns. While Chipotle's current price-to-earnings ratio around 160 is certainly not cheap, the business still exhibits tremendous growth potential.
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Another good quarter
Chipotle's revenue reached $1.96 billion last quarter: up 22% on a 15.2% comparable sales increase. This result roughly lined up with the guidance management provided in October, despite the negative impact of the omicron variant on restaurant traffic in late December.
A solid outlook
Chipotle expects comp sales growth to slow to a single-digit pace in the first quarter. However, that reflects a weak start to the year, as the omicron wave and poor weather caused comp sales growth to slow to around 5% in January. Sales growth should reaccelerate over the next couple of months.
A pricey stock
Chipotle stock trades for more than 60 times trailing earnings and 49 times the 2022 analyst EPS consensus of $31.64. That represents a big premium to the broader market.
Is there enough margin expansion potential?
It would be hard to justify buying Chipotle stock at its current price based on the company's revenue growth potential alone. That said, the stock could still pay off for investors if the company manages to significantly improve its profitability over time.
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Does chipotle have cauliflower rice?
Last week was a busy one for Chipotle, which also announced its plans to test cauliflower rice in 55 restaurants. Cauliflower rice might be a new concept to some, but it's growing rapidly with the anti-carb crowd and consumers in general, as it becomes a lower-carbohydrate replacement for traditional rice.
Is Chipotlanes going to be a breakfast company?
To be clear, the company has no public plans to enter the breakfast market, citing its strategic focus on digital and mobile orders. CEO Brian Niccol has repeatedly turned down the idea, with responses to breakfast inquiries ranging from "not at all" to "not now." Chances here are slim right now, but breakfast is an obvious growth option. Once the company has its mobile ordering and its Chipotlanes operating under muscle memory, it could and should revisit a breakfast offering.
Does chipotle need a catalyst?
Chipotle doesn't need all these potential catalysts to harmonize to see continued success. 81% digital sales growth speaks to the demand for its products and its ability to meet that demand. A company doesn't hire 10,000 new employees during an economic downturn unless it's very confident about its own future.
