Market Overview

Ackman Addresses Chipotle Issues

Share:
Ackman Addresses Chipotle Issues
Related CMG
Benzinga's Top Upgrades, Downgrades For January 19, 2018
Kimbal Musk Brings Gardening And Food Literacy Effort To Detroit
Chipotle +2% as Raymond James upgrades, but Cowen still has sour view (Seeking Alpha)

Bill Ackman said Monday that Chipotle Mexican Grill, Inc. (NYSE: CMG) is imminently fixable and he's hoping the company is going to recover.

Speaking on CNBC, Ackman said he's optimistic, because there are still lines in the stores and the issues the company is facing are addressable through better operations and better oversight. Other restaurants, like McDonald's Corporation (NYSE: MCD) and Burger King had up and down cycles, said Ackman, implying similar cycles are possible for Chipotle.

Ackman finds Chipotle interesting because he sees it as the least optimized of the quick-service restaurants. The company doesn't have a drive-through, it's not serving breakfast, it's not active abroad and it doesn't have a mobile app, explained Ackman. He added that the mobile app would reduce lines, which are now turning the customers away.

The valuation is cheap if you consider earnings over the next six years, according to Ackman. He emphasized that the company has to recover from the food safety crisis and he explained that almost every fast food company successfully recovered from food safety crisis.

Related Links:

Let's Cut To The Cheese: After Sluggish Q3, Chipotle Still A 'Show Me' Story

Wall Street Remains Sidelined On Chipotle After Disappointing Q3

Posted-In: Bill AckmanCNBC Hedge Funds Restaurants Media General Best of Benzinga

 

Related Articles (CMG + MCD)

View Comments and Join the Discussion!