Market Overview

UPDATE: BMO Capital Markets Initiates Coverage On Chipotle Mexican Grill

Related CMG
Whole Foods' Hepatitis A Outbreak And Other Past Food Scares
Comps Will Be In Focus As 3 Restaurant Stocks Prepare To Report Q3 Results
Burger King Parent Restaurant Brands' Earnings Top After McDonald's Beats (Investor's Business Daily)

BMO Capital Markets initiated coverage of Chipotle Mexican Grill, Inc. (NYSE: CMG) with a Market Perform rating and $720 price target.

Analyst Andrew Strelzik believed "CMG will exceed expectations over the next 18 months" and suggested there is a "cushion to our above-consensus expectations in terms of same-store sales and food, labor, and general and administrative costs."

Despite expectations, Strelzik felt that "investors should wait for a more attractive entry point in CMG’s stock" because the company "is trading at a forward 12-month P/E and EV/EBITDA of 40-41x and 20-21x, which is 10-15 percent above its historical average valuation."

The report noted that "2014 and 2015 EPS estimates of $14.10 and $17.93 are above consensus by $0.41 and $0.46, respectively (3 percent)."

The price target implied a "40-41x P/E multiple on our 2015 EPS, which is in line with current levels, a 10-15 percent premium to its historical average (35-36x), and in line with its 55-60 percent premium to the restaurant industry over the past two years."

Chipotle Mexican Grill, Inc. closed at $660.61 Thursday, down 1.71 percent.

Latest Ratings for CMG

Oct 2016RBC CapitalMaintainsOutperform
Oct 2016Raymond JamesDowngradesMarket PerformUnderperform
Oct 2016NomuraMaintainsNeutral

View More Analyst Ratings for CMG
View the Latest Analyst Ratings

Posted-In: Andrew Strelzik BMO Capital MarketsAnalyst Color Price Target Initiation Analyst Ratings


Related Articles (CMG)

View Comments and Join the Discussion!