UPDATE: Deutsche Bank Downgrades Chipotle Mexican Grill to Hold, Lowers PT

In a report published Friday, Deutsche Bank downgraded its rating on Chipotle Mexican Grill

from Buy to Hold, and lowered its price target from $460.00 to $375.00. Deutsche Bank noted, “While most of CMG's troubles appear to be external, we see enough risks/headwinds to give us pause on what is otherwise a high-quality story w/ significant runway for growth. Lower to Hold given macro overhang, signs that food infl. could re-emerge in coming qtrs., and less room to raise prices given softer traffic (not a good combination). CMG posted a significant beat on 2Q EPS. However, this was driven by upside on margins (mostly G&A and marketing), while comps were disappointing at +8% vs. +10% expected. (First comp below 10% since 2Q10.) The 2Q margin improvement will likely be viewed as somewhat temporary, while the comp decel. will be viewed as more worrisome and extrapolated into future qtrs., leading to significant weakness in the stock on Fri. (indicated down 11%).” Chipotle Mexican Grill closed on Thursday at $403.86.