Momentum: Chipotle Mexican Grill (CMG)

Chipotle Mexican Grill, Inc. (CMG) recently rebounded from a small dip lower to move back within striking distance of the all-time high after reporting better than expected Q2 results in late July. Estimates have since been on the move, with the next-year estimate now projecting 19% growth for this Zacks #2 rank stock.

Second-Quarter Results

Chipotle gave the bulls something to cheer about on July 22 with better than expected Q2 results that were driven by higher volumes and continued expansion.

Revenue for the period was up 20% from last year to $467 million, with comparable store sales showing a solid 8.7% gain. Earnings also came in strong at $1.46, 5% ahead of the Zacks Consensus Estimate. Chipotle now has an average earnings surprise of 19% over the last four quarters.

The strong top-line results were accompanied by tight cost and expense management, with operating margin up 90 basis points from last year to 26.9%. The company also opened 25 new stores during the quarter for a grand total of 1,001, including its first presence in London.

Estimates Climb

The analysts were encouraged by the results, pushing the current-year estimate 9 cents higher to $5.08. The next-year estimate is up 16 cents on the good quarter to $6.05, a 19% growth projection.


In light of the recent gains, CMG does look a bit pricey, trading with a forward P/E of 31X against its peer’s 19X.

2-Year Chart

CMG has spent most of the last 15 months trending higher before spiking on the news to move back within striking distance of the all-time high just above $155. The MACD below the chart recently turned bullish too, take a look below.

Read the May 19 CMG article here

Last Week’s Momentum Zacks Rank Buy Stocks

UAL Corp. (UAUA) just hit a new multi-year high after reporting its first quarterly profit since 2007 that included an 11% earnings surprise. Estimates have since turned higher, providing some nice upward momentum for this Zacks #1 rank stock. Read Full Article.

Complete Production Services, Inc. (CPX) is fresh off the heels of an awesome 567% earnings surprise that sent shares blasting past a key level of resistance to a new multi-year high. Estimates jumped higher on the news, with the next year now projecting bullish 81% growth. Read Full Article.

Alaska Air Group, Inc. (ALK) is once again pressuring its all-time high after reporting excellent Q2 results on July 22 that saw income double from last year. With the current-year estimate pegged at $6.59, a 168% growth projection from last year, analysts are looking for a strong finish to the year. Read Full Article.

Avago Technologies Limited (AVGO) continues to trade near its 52-week high after reporting better than expected Q2 results in late May that included a 7% earnings surprise. With an attractive valuation and bullish next-year estimate, this stock has some nice upward momentum. Read Full Article.

CHIPOTLE MEXICN (CMG): Free Stock Analysis Report

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About Michael Vodicka 49 Articles

Affiliation: Zacks Investment Research

Visit: Zacks Investment Research

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