Chipotle Posts Upbeat Q4 Results; Street Says Buy

Fast casual restaurant chain operator Chipotle Mexican Grill, Inc. (NYSE: CMG) has reported stronger-than-expected results for the quarter ended December 31, 2021. The robust results were on the back of solid growth in revenues.

Following the earnings, shares of the company popped 6.6% to close at $1,557 in Tuesday’s extended trading session.

Revenue & Earnings

Chipotle’s revenue for the quarter rose 22% year-over-year to $2 billion, surpassing the consensus estimate of $1.95 billion. The primary driver of this growth was the 15.2% year-over-year rise in comparable restaurant sales and new restaurant openings.

The company reported quarterly earnings of $5.58 per share, which denotes a year-over-year rise of 60.3%. The figure also topped the consensus estimate of $5.29 per share.

Meanwhile, Chipotle opened 78 new restaurants in the quarter. The company’s restaurant-level operating margin improved from 19.5% in the prior year to 20.2%, while the overall operating margin increased to 8.1% from 7.3% in the previous year.

Outlook

For the first quarter, Chipotle forecasts comparable restaurant sales growth in the mid to high-single-digits range, while it expects to open 235 to 250 new restaurants in 2022.

Further, the company expects an underlying effective full-year tax rate in the range of 25% and 27%.

Stock Rating

Consensus among analysts is a Strong Buy based on 15 Buys and 3 Holds. The average Chipotle stock prediction of $1,972.65 implies 35.1% upside potential from current levels. Shares have declined 5.8% over the past year.

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