| Stock (Symbol) | Stock Price | |
Chipotle (CMG) |
$296 |
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| Data is as of | Expected to Report | Sector |
July 30, 2012 |
July 16 |
Retail & Restaurant |
| Sharek’s Take | ||
 Chipotle stock was “priced to perfection” last quarter. This quarter the stock fell from $400 to $300, which is in line with what it is really worth.Sames store sales growth of “only” 8% last quarter and increasing food costs were to blame for the stock’s fall. Eight percent isn’t that bad, but the stock was overpriced to begin with and was dangerously high. Same-store sales growth was 8% LastQtr, 13% 2QtrsAgo, 11% 3QtrsAgo, 11% 4QtrsAgo. Only 8% growth? That’s just an excuse to send the stock down, as is the food cost blame-game. Food costs have been rising for a while now. CMG was overvalued at $400 and is now fairly valued around $300 — that’s the bottom line. |
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| One-Year Chart | ||
 Last quarter I stated ” CMG’s P/E is really high — about as high as it can get. I’ve been taking profits in the stock for a while and will continue to do so.” Since my last research report three months ago, CMG’s P/E has gone from 46 to 33. |
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| Earnings Table | ||
 Profits shot ahead 56% last quarter on a 20% increase in sales. Sales rose 26% 2QtrsAgo.CMG really crushed estimates last quarter — beating by 26 cents — the biggest beat in more than a year. Annual Profit Estimates increased for 2012, and fell a bit for 2013 and 2014. Quarterly estimates show 21% to 25% growth ahead in the next three quarters, but these estimates did fall from last quarter. |
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| Fair Value | ||
 I’m taking the Fair Value P/E down from 35 to 30. Stock’s around Fair Value now. |
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| Ten-Year Chart | ||
 CMG just broke down after a parabolic move , then broke support at $350 and is hitting a lower support level now around $300. I think the stock will base a while and not do anything for 3 to 6 months. Maybe longer. |
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| Power Ranking | Bottom Line | |
Growth Portfolio
13 of 15 |
Chipotle was bound to come back to reality sometime. The stock was high and I had been taking profits so much it left me with a little position in the stock. Now CMG is close to its Fair Value and should go sideways for a while. CMG is ranked 13th of 15 stocks in the Growth Portfolio Power Rankings. The stock is not a candidate for the Aggressive Growth Portfolio until it gets undervalued. |
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Aggressive Growth Portfolio
N/A |
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