Chipotle Sees Large Q1 Loss, But Says Comps Decline Is Improving
Investors are selling shares of Chipotle Mexican Grill, Inc. (NYSE: CMG) Tuesday afternoon following a concerning first-quarter same-store sales and loss per share update.
An 8-K filing from the company showed restaurant sales since the fourth-quarter earnings conference call on February 3, 2016 "have started to recover."
Update On Comps
- Same-store sales fell 26.1 percent in February, from a 36.4 percent decline in January.
- Comps were down 21.5 percent for the week ended March 7.
- Comps down 27.3 percent for second week in March.
For the February improvement, Chipotle cited the launch of "an aggressive marketing campaign that coincided with our National Team Meeting, to invite customers to dine at Chipotle via a free burrito offer."
As for the decline between the first and second weeks in March, Chipotle attributed an impact from "the temporary closing of a single Boston area restaurant which was the result of our restaurant teams fully following protocols."
Update On Earnings, Operating Margin
Certainly concerning bulls in Chipotle shares, the company's filing disclosed a new forecast for first-quarter bottom-line performance: "we expect EPS will be a loss of $1.00 per share or worse."
Analysts on Chipotle were modeling for the company to report first-quarter earnings of $0.11 per share.
Chipotle said restaurant-level operating margin will be in the mid-single digit range.
After-Hours Price Action
Shares of Chipotle have been volatile in Tuesday's post-market session; after initially plunging to an after-hours low of $472.60, shares rebounded to nearly the $490 level.
At last check, Chipotle's stock traded down about 4 percent to $483.
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