Normally when analysts start coming out in favor of a stock as being in the midst of a buying opportunity, investors take that seriously and buy in. But despite a growing body of support for Chipotle (CMG) stock, shares were on the decline anyway. Chipotle shares were down nearly 2% in Wednesday afternoon’s session despite the growing interest from analysts.
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Basically, noted word from several analysts, Chipotle shares could be in the midst of a buying opportunity. And perhaps more interestingly, shares are up significantly in the course of Wednesday’s trading, which fell as much as 5.6% earlier, reports noted. Chipotle offered up its earnings report late on Tuesday, and the numbers were not exactly great. Same-store sales dropped in January—which is little surprise given the weather—and same-store sales for 2025 were not looking much like growth.
But analysts were still looking for better than expected results. Jon Tower, for example—an analyst with Citigroup—noted that an expected menu upgrade for “honey chicken” should prove a catalyst for upward sales. Meanwhile, UBS analyst Dennis Geiger also noted that “solid underlying traffic” was still in play, and that “…one-off calendar / weather headwinds…” would likely not have much impact going forward.
Good Reasons to Get In
Meanwhile, other reports point out several key points to keep in mind about Chipotle that could make its earnings come out ultimately better than even Chipotle itself expected. It helps that comparable-store sales have been on the rise since 2018, so while there may be a peak approaching, the sales are still pretty solid.
Throw in rapid expansion with plenty of new restaurant locations opening up, and a new CEO in Scott Boatwright who was Brian Niccol’s chief operating officer, and that should help keep Chipotle on a reasonably upward trend. The market may be getting tough as food costs remain high all over, but Chipotle’s plan to expand should cut into some of that as more customers come in overall.
Is Chipotle a Buy, Sell or Hold?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on CMG stock based on 16 Buys and six Holds assigned in the past three months, as indicated by the graphic below. After a 16.58% rally in its share price over the past year, the average CMG price target of $67.91 per share implies 17.01% upside potential.
