UPDATE: Belus Capital's Sozzi Upgrades Chipotle to Buy, Wants Investors to Chow Down on Shares - Chipotle Mexican Grill (NYSE:CMG)

Belus Capital's Brian Sozzi upgraded shares of Chipotle Mexican Grill, Inc.

CMG

from Hold to Buy in a research note Wednesday morning. The analyst raised his price target from $500.00 to $600.00. Sozzi's note follows

fourth-quarter results

from Chipotle on January 30th. The analyst highlighted an attractive PE multiple and call action which is signaling the stock is "destined to hit $1,000," arguing "Chipotle is in the good graces of Wall Street, deservedly so." The Belus Capital analyst cited a number of near-term and longer-term fundamental justifications for the Street's optimism. Sozzi sees strength

today

due to:

increasingly quicker line throughput (during peak times people are getting onto, and off of, the line faster);
intensely positive customer response to new restaurant locations (could see this via photos on a Chipotle keyword search on Twitter); and
a switch to a non-GMO menu that in our view has begun to already appear in same-restaurant sales (people feel better about eating at Chipotle and share with others, personally or on social media, that positive experience).

Sozzi sees strength in the

future

due to:

an accelerated pace of domestic new Chipotle openings;
a careful introduction of new menu items (sofritas; we expect some form of broader breakfast platform in short older);
the start of a restaurant remodeling campaign to stay fresh and relevant, and capture more of the post-work crowd;
a high probability of a menu price increase of 3%-5% by mid-2014 that bolsters same-restaurant sales and more than counteracts food inflation and ingredient (GMO initiative) investment;
new concepts are being rolled out thoughtfully as to preserve the cultural element that has made Chipotle successful; and
investments in mobile payment that will further speed up throughput.

Chipotle shares are trading up about 0.3 percent to $546.50 ahead of the opening bell. Sozzi's new price target represents potential upside of about 10 percent from where the stock is currently trading.

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