Chipotle Rolls Up Some Fat Earnings

Jacob Harper |


chipotle, chipotle stock, chipotle earnings, fast food stocksFast-casual chain Chipotle Mexican Grill (CMG) issued their earnings report after the bell on July 21, and the theoretically Mexican-food purveyor dished out a healthy helping of profits, with a generous side of extra revenues.

Investors were astounded that Chipotle — famous for their made-to-order, healthier fast food — was able to dig down and provide even more positive news after stockholders had already gorged on profits. Wall Street had set high expectations for the company, but the chain creamed them.

Chipotle is really bringing in the cheese now, and for the first time reported sales that topped $1 billion. Despite the company’s impressive earnings last year that saw the company’s valuation bloat out like so many overstuffed burritos, Chipotle has continued to grow, and its stock is up 10 percent on the year.

Chipotle has grilled the competition this year, and has emerged as the real star of the fast-casual movement. While compatriots like Panera Bread (PNRA) and Noodles & Company (NDLS) have served up decent profits, none have proven to be as monumentally popular as Chipotle.

Analysts at JP Morgan Chase and Co. (JPM) wrote in a note to clients that “we believe almost no companies can match the realized/possible sales drivers that Chipotle has.” The ability to serve customers in rapid succession, longer hours, and increasing trend towards healthier dining option all bode well for the giant burrito-serving giant.   

For their fourth quarter 2013 earnings report, Chipotle reported a net gain of $110.03 million, or $3.50 per share, versus the net profit of $87.9 million, or $2.82 per share, from the same period a year ago. Revenue for the quarter was $1.05 billion, as compared to $816.8 million from the previous year. Analysts were expecting a profit of $3.05 per share on revenues of $988 million.

What got the market really going though were Chipotle’s tasty same-store sales. A widely used barometer for judging the health of brick-and-mortar businesses, same-store revenues for the healthy fast-casual chain reported a whopping 17.3 percent. Analysts were only expecting a 10.3 percent increase.  

The company’s revenue has doubled since 2011 and their shares have doubled in kind, making it the seventh most expensive stock on the entire American market. The price jump after the earnings beat pushed the blue-chip stock to an all-time high, though this hasn’t scared off investors who still think Chipotle can take an even bigger bite out of the fast-casual market.   

As of 2 PM EST shares of Chipotle stood at $664.91 apiece, representing a gain of 12.71 percent on the day.

 

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Companies

Symbol Name Price Change % Volume
CMG Chipotle Mexican Grill Inc. 366.37 -29.90 -7.55 4,936,986
NDLS Noodles & Company 4.30 0.05 1.18 129,810
PNRA Panera Bread Company 215.02 1.51 0.71 410,188
KAP:PUR Kapuskasing Gold Corp. 0.03 0.00 0.00 0

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