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Chipotle Mexican Grill, Inc. (CMG), headquartered in Newport Beach, California, owns and operates Chipotle Mexican Grill restaurants. With a market cap of $71.1 billion, the company sells food and beverages by offering burritos, burrito bowls, quesadillas, tacos, and salads.
Shares of this Mexican food giant have underperformed the broader market over the past year. CMG has gained marginally over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 17.5%. In 2025, CMG stock is down 11.4%, compared to SPX’s 1.3% rise on a YTD basis.
Narrowing the focus, CMG’s underperformance is also apparent compared to the AdvisorShares Restaurant ETF (EATZ). The exchange-traded fund has gained about 21.9% over the past year. Moreover, the ETF’s 3.8% gains on a YTD basis outshine the stock’s double-digit losses over the same time frame.
CMG's underperformance can be linked to its declining comparable sales growth rate for the second consecutive quarter, falling below 10% for the third time in four quarters. Additionally, the threat of 25% tariffs on Mexican imports by President Trump poses a potential risk to CMG's earnings, particularly as the company imports half of its avocados from Mexico. Moreover, management projects that these tariffs could result in a 60-basis point increase in its cost of sales.
On Feb. 4, CMG shares closed up more than 1% after reporting its Q4 results. Its adjusted EPS of $0.25 exceeded Wall Street expectations of $0.24. The company’s revenue was $2.9 billion, meeting Wall Street forecasts.
For fiscal 2025, ending in December, analysts expect CMG’s EPS to grow 15.2% to $1.29 on a diluted basis. The company’s earnings surprise history is impressive. It beat the consensus estimate in each of the last four quarters.
Among the 31 analysts covering CMG stock, the consensus is a “Moderate Buy.” That’s based on 20 “Strong Buy” ratings, two “Moderate Buys,” and nine “Holds.”
The configuration is consistent over the past three months.
On Feb. 21, Citigroup Inc. (C) placed CMG on a “90-day positive catalyst watch” while keeping a “Buy” rating with a $70 price target, implying a potential upside of 31% from current levels.
The mean price target of $66.42 represents a 24.3% premium to CMG’s current price levels. The Street-high price target of $75 suggests an ambitious upside potential of 40.4%.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
