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Chipotle Is Having Its Second-Worst Day Of 2016

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Chipotle Is Having Its Second-Worst Day Of 2016

Chipotle Mexican Grill, Inc. (NYSE: CMG) shares are getting hammered by more than 7.8 percent on Tuesday following troubling management commentary about forward guidance at the Barclays retail conference in New York.

Shareholders seem particularly concerned about the fact that management admitted to being “nervous” about hitting its Q4 guidance.

A number of food safety issues plagued the company throughout late 2015 and early 2016, including multiple outbreaks of E. coli.

Chipotle lost a large portion of its customer base during that period, while sales and share prices plummeted as well.

Recent Selloff

Tuesday’s selloff is the second-worst day for Chipotle stock in 2016. Shares plummeted 9 percent following the company’s disappointing Q3 earnings report back in October.

Q3 sales fell 21.9 percent, missing consensus expectations of an 18.9 percent decline. EPS of $0.56 also fell well short of consensus predictions of $1.59.

Chipotle stock is now down 23.7 year-to-date and is trading near its lowest level in almost four years.

So far, Chipotle’s plan to recover its lost customers hasn’t gone as planned, and CEO Steve Ells said on Tuesday that customer service may be one problem that needs to be addressed.

Chipotle is expected to report Q4 results in late January.

Posted-In: Earnings News Guidance Previews Restaurants Movers Trading Ideas General Best of Benzinga

 

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