Chipotle Stock: Buy Rating & Strong Sales Growth


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This article covers our Chipotle have a supply of rating and the company’s contemporary news headlines following its return crash.

Initially, we added Chipotle have a supply of (NYSE:CMG) to our Bullish List on November 1st, 2016. At with the intention of calculate, Chipotle have a supply of traded around $360 for every share. Today, shares of Chipotle are trading up roughly 5-6% on reported sales growth of in this area 14.7% compared to the month of December continue time. To think it over Chipotle’s return crash and other fiscal statements, visit the company’s investor relations.

Strong Sales Growth

Primarily, our bullishness on Chipotle have a supply of is due to our expectations of prospect growth in the affair economics of the restaurant string. We believe the contract develop pro this point affair gives investors noteworthy opportunity pro extension in the years to occur. Of way, CMG is already priced pro moderate growth. The Stock Trader Blog’s bullish thesis relies on humanizing operating margins and stronger than probable return growth.

Activist Investing in Chipotle Stock

Furthermore, we believe investing in stocks of companies that have activist investors working to boost shareholder value provides an extra margin of safety for retail shareholders. In the case of Chipotle, Bill Ackman is undoubtedly the largest activist investor in the company.

Chipotle has a number of other attractive attributes which include limited global macroeconomic sensitivity and foreign currency exposure, a simple business model with limited non-GAAP earnings adjustments, a high effective tax rate of nearly 40% (which means the company will be a big beneficiary of lower U.S. tax rates if implemented by the Trump administration) and an unlevered balance sheet with a strong net cash position.Bill Ackman in Pershing Square’s Q3 Letter to Shareholders

CMG Stock Rating: Buy

For the reasons listed above, we are maintaining a buy rating for CMG stock. Therefore, it remains on our Bullish List until further notice. To see which stocks we have a sell rating on, visit our Bearish List.

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