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Tuesday, Guggenheim analysts revised their outlook on Chipotle Mexican Grill (NYSE:CMG) shares, lowering the price target to $48 from the previous $56, while maintaining a neutral stance on the stock. The adjustment comes as the firm anticipates the company to present its earnings report on Wednesday. According to InvestingPro data, CMG currently trades at a P/E ratio of 41.1x, with 14 analysts recently revising their earnings expectations downward.
The revision by Guggenheim is based on observed soft trends in the early first quarter, which were impacted by adverse weather conditions and calendar shifts. These factors contributed to a deceleration in underlying traffic trends throughout the quarter and into the early second quarter. The analysts expect Chipotle to potentially revise its same-store sales (SSS) guidance to a range from flat to low single-digit growth for the year, despite the company’s impressive revenue growth of 14.6% over the last twelve months.
As a result of these trends, Guggenheim’s projections for Chipotle’s earnings per share (EPS) for 2025 and 2026 are now 6% and 11% below the consensus, respectively. This has led to a recalibration of the price target to $48 per share, which is calculated at 36 times Guggenheim’s 2026 EPS estimate.
The firm’s neutral rating indicates that while there may be some concerns about the company’s near-term performance, Guggenheim does not suggest a significant change in investment posture regarding Chipotle’s shares at this time. The new price target reflects a cautious outlook on the company’s financial prospects in the face of the challenges identified.
In other recent news, Chipotle Mexican Grill is planning to make its debut in the Mexican market by early 2026 through a development agreement with Alsea (BMV:ALSEA), S.A.B. de C.V., a major restaurant operator in Latin America. This expansion is part of Chipotle’s broader strategy to increase its global presence, with the company already operating over 3,700 restaurants worldwide. Meanwhile, UBS has revised its price target for Chipotle shares to $65, maintaining a Buy rating, and highlighting the company’s potential for long-term growth despite current sales challenges. Similarly, RBC Capital Markets adjusted its price target to $65 from $70 but upheld an Outperform rating, noting stable customer traffic despite minor shifts in preferences for the new chipotle honey chicken offering.
KeyBanc Capital Markets also lowered its price target for Chipotle to $60, while keeping an Overweight rating, citing a complex growth path in the latter half of the year. The analyst emphasized the company’s core offerings as a significant value proposition compared to competitors. RBC Capital Markets, in another report, maintained its Outperform rating with a $70 target, pointing out Chipotle’s strong growth drivers and potential resilience against economic challenges. The firm’s analysis suggests that Chipotle’s pricing power and consumer value proposition remain solid despite near-term headwinds. These developments reflect a mix of cautious optimism and strategic planning as Chipotle navigates its growth trajectory.
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