Why I Wouldn’t Buy Chipotle Stock After Last Week’s Earnings Beat

Chipotle Mexican Grill’s (NYSE: CMG) post-pandemic recovery continued to gain traction in the first few months of 2021. Indeed, the fast-casual pioneer set new records for quarterly revenue and adjusted earnings per share last quarter.
Revenue and earnings growth is poised to accelerate further in the second quarter, thanks to easy year-over-year comparisons and the continued reopening of the U.S. economy. However, Chipotle’s earnings growth is likely to moderate within a few years. That makes Chipotle stock — which has rallied 88% over the past year — look overpriced at 47 times the company’s projected 2022 earnings.

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