Chipotle seen as a star in the restaurant Industry

Credit Suisse on Tuesday issued a report on the Restaurant Sector and highlighted Chipotle Mexican Grille Inc.(NYSE: CMG) as as one of their industry leaders. Currently the firm rates Chipotle as OutPerform with a $785 price target which represents a 19 percent upside to its current price.Chipotle Mexican Grille Inc. previously closed at $654.74. Jason West, an analyst at Credit Suisse wrote, "CMG offers the best combination of growth and returns in the group. Given a recent pullback, the stock is trading near an all-time low relative to the industry. We see the negative scenario of flattening SSS as unlikely given embedded pricing, catering/mobile, growing brand awareness, and macro tailwind."Credit Suisse says that Chipotle is best positioned to capitalize on consumer preferences for authentic, high-quality food served in a fast, customizable format. Their management team is one of the most stable in the industry and has done an excellent job creating a unique and impactful marketing approach with a limited budget while being innovative in company practices to stay ahead of the competition.While Chipotle is one of the bright spots in the restaurant industry,with same store sales growth averaging 8.5 percent over the past 5 years, rising food costs pose a threat to the company's continued growth. Food costs represented 35 percent of revenue in the fourth quarter, which has caused the Mexican food chain to raise prices on menu items which may alienate customers. However Chipotle's commitment to fresh, naturally sourced ingredients appeals to the new generation of customers. In a report from the National Restaurant Association three-quarters of consumers say they are more likely to visit a restaurant that offers healthy options and seven in 10 say they also order more healthful options in restaurants than they did two years ago. Going forward lower gas prices and steady improvement in operations should continue to have Chipotle remain a market leader.