Chipotle (CMG) Stock Forecast & Price Target

Chipotle Mexican Grill reported systemwide sales of $11.3 billion in 2024, positioning itself firmly as the largest fast-casual restaurant chain in the U.S. Despite experiencing modest increases in operating costs and food expenses, the company has demonstrated resilience with improved same-store sales growth, particularly a noteworthy increase from approximately 7% to 8% in early 2024, aided by the successful introduction of Honey Chicken. Additionally, the brand's favorable value perceptions relative to its competitors, alongside guidance suggesting positive same-store sales growth entering the second half of 2025, underpin a compelling case for its continued market strength and potential for share gains.

Chipotle Mexican Grill has lowered its fiscal year 2025 same-store sales guidance to a low-single-digit percentage, reflecting challenges in the current macroeconomic environment. The company reported a year-over-year contraction of approximately 130 basis points in its restaurant-level margins to 26.2% for the first quarter of 2025, primarily due to softer comparable sales, commodity inflation, and pressures from limited-time offerings. Additionally, the decline in transactions by 2.3% in the first quarter, compared to an increase of 4.0% in the preceding quarter, raises concerns about the sustainability of sales and margins, prompting a decrease in adjusted earnings per share estimates for 2025 and 2026.