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Analyst: Chipotle Is Successful Because It Sticks To What Works (Giant, Tasty Burritos)

Analyst: Chipotle Is Successful Because It Sticks To What Works Giant, Tasty Burritos
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In a recent piece for The Street, Brian Sozzi looked at Chipotle Mexican Grill, Inc. (NYSE: CMG) and how the popular restaurant chain is approaching new trends in service, food and technology.

While other restaurants seem to be constantly looking for the "next big thing" and scrambling to keep up with the latest fads, Chipotle has had incredible success sticking to what works: good food and service. Since going public in 2006, Chipotle's stock is up an incredible 1,429 percent.

However, Sozzi notes that Chipotle's menu is essentially the same as it was when the chain first opened 20 years ago.

Related Link: Brian Sozzi: Is Best Buy The Next RadioShack? No Way!

Delivery? No Thanks

Starbucks Corporation (NYSE: SBUX) recently announced an experimental delivery service through a partnership with courier network Postmates in Seattle. GrubHub Inc (NYSE: GRUB) and Yelp Inc (NYSE: YELP) have also made pushes into the food delivery business lately.

However, Chipotle is happy with the way things are.

"We want people to come visit us," Chipotle communications director Chris Arnold told Sozzi.

Keeping Mobile Simple

With the launch of the new Apple Inc. (NASDAQ: AAPL) Watch and mobile payment platforms Apple Pay and Google Inc (NASDAQ: GOOG) (NASDAQ: GOOGL) Wallet, many restaurants are struggling to adapt their apps for mobile payment. Not Chipotle.

While Chipotle is expected to come out with an update to its mobile app in the near future, Arnold says payment will continue to be linked to traditional credit cards.

Edible Utensils? Yuck

Yum! Brands, Inc. (NYSE: YUM) KFC chain recently attracted attention with its testing of edible "green" coffee cups in targeted U.K. markets.

Chipotle's silverware is compostable, and its burrito bowl is made from 93 percent recycled material, but customers won't see edible cups or any other gimmicky stunts at Chipotle any time soon.

The Bottom Line

Chipotle has had unimaginable success by keeping things simple.

As long as that strategy continues to work, that's the approach the company will continue to take. "When all is said and done, Wall Street will have to deal with Chipotle simply being Chipotle," Sozzi concludes.

Image credit: Steven Depolo, Flickr

Latest Ratings for CMG

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

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