Chipotle Grill Trades Flat Regardless of Delivering Spicy Earnings


Chipotle Mexican Grill, Inc. (CMG) shares exchanged palms comparatively unchanged in Wednesday’s extended-hours session, regardless of the Mexican meals chain reporting blowout earnings.

The corporate posted a first-quarter (Q1) adjusted revenue of $5.36 per share, with the determine topping Wall Avenue’s expectation of $4.89 a share and rising 74% from the year-ago quarter. In the meantime, income of $1.74 billion throughout the interval met analysts’ forecasts.

Comparable retailer gross sales boosted the highest line, climbing 17.2% from a 12 months earlier and 21% from pre-pandemic ranges in 2019. On-line orders, which account for round 50% of complete gross sales, greater than doubled throughout the quarter. Administration credited a spread of recent menu objects and authorities stimulus checks for the better-than-expected outcome.

Regardless of the corporate selecting to not present full-year earnings steering, Chairman and CEO Brian Niccol remained upbeat concerning the months forward. “As vaccines roll out and we get nearer to transferring previous this pandemic, I imagine Chipotle is well-positioned for development. I’m enthusiastic about our future as we stay targeted on innovating in culinary, main in meals with integrity, and offering handy entry inside our eating places and thru our increasing digital ecosystem,” he instructed traders, per PR Newswire.

By Wednesday’s shut, Chipotle inventory has a market worth exceeding $40 billion and trades 92% excessive over the previous 12 months. 12 months to this point (YTD), the shares have added 8.72%, barely trailing the S&P 500’s 11% acquire over the identical interval. Valuation-wise, the inventory trades 20% above its five-year common projected earnings a number of of 55.36 occasions.

Wall Avenue View

Final month, Cowen analyst Andrew Charles reiterated his ‘Outperform’ ranking and $1900 worth goal on Chipotle shares. Charles pointed to the corporate’s underappreciated development facets, potential for broader loyalty adoption, and digital initiatives as supporting components.

Protection stays largely bullish elsewhere on Wall Avenue. The inventory receives 17 ‘Purchase’ scores, 3 ‘Obese’ scores, and 13 ‘Maintain’ scores. Only one analyst has positioned an ‘Underweight’ advice on the shares. The inventory at present gives a 14% low cost to analysts’ 12-month median worth goal of $1,720.

Technical Outlook and Buying and selling Ways

Since bottoming out round $450 a share on the peak of final 12 months’s pandemic sell-off, Chipotle shares have trended persistently increased. Extra lately, the inventory has shaped two swing highs on the $1,560 stage, rising the opportunity of a double high. Moreover, the second peak made a barely increased excessive whereas the RSI indicator made a comparatively shallower excessive to mark a bearish divergence between worth and the indicator.

Energetic merchants who open a brief place ought to goal a transfer all the way down to the $1,365 space the place the shares discover a confluence of help from a horizontal trendline and the rising 200-day easy transferring common (SMA). Shield buying and selling capital by inserting a stop-loss order simply above the excessive of the second peak at $1,579.52.

For a have a look at in the present day’s earnings schedule, try our earnings calendar.

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