Core Insights - The last 16 months have been challenging for Chipotle, marked by a PR crisis regarding meal proportions, the departure of CEO Brian Niccol, and a decline in same-store growth, placing the company at the bottom of the industry leaderboard [1] Company Analysis - Chipotle has faced significant challenges including a public relations crisis and leadership changes, which have negatively impacted its performance [1] - The company aims to invest in firms with strong qualitative attributes and seeks to buy at attractive prices based on fundamentals, indicating a focus on long-term value [1] Investment Strategy - The investment strategy involves maintaining a concentrated portfolio that aims to avoid underperforming stocks while maximizing exposure to high-potential winners [1] - Companies may be rated as 'Hold' if their growth opportunities do not meet the investor's threshold or if the downside risks are deemed too high [1]

Core Insights - Chipotle Mexican Grill and BÉIS have launched "The To Go Collection," an 11-piece capsule collection aimed at making it easier and stylish to transport Chipotle food [1][2][3] - The collection features insulated designs to keep food warm, convenient pockets for napkins, and fashionable styles suitable for travel [4][9] Product Details - The collection includes various items such as the Take Out Tote Bag, Burrito Holder Sling, and Burrito Duffle, with prices ranging from $18 to $378 [15] - The first 5,000 orders in the U.S. and Canada will receive a free entrée code from Chipotle, valid for one entrée item [7][12] Launch Events - A public "BÉISpotle" pop-up experience will take place at Chipotle Larchmont in Los Angeles on December 6-7, 2025, offering fans early access to shop the collection [4][11] - The collection will be available for purchase starting December 8, 2025, on the BÉIS app and beistravel.com [6][9]

Core Viewpoint - Chipotle has experienced significant stock performance fluctuations, with a notable decline in the past year despite a strong long-term track record, leading to underperformance compared to the broader market [1][2]. One-Year Return - Chipotle's stock has decreased by 44.5% over the past year, primarily due to rising food costs and plateauing same-store sales growth, with a projected decline in same-store sales for Q4 [1]. - In contrast, the S&P 500 has increased by 13.2% this year, resulting in a 57.7 percentage point underperformance for Chipotle shareholders [2]. Three-Year Return - Over the past three years, Chipotle's stock has only risen by 5.1%, erasing gains from the previous two years, despite a 100% increase between December 2022 and June 2024 [3]. - The S&P 500 has gained 67.5% over the same period, indicating a 62.4 percentage point underperformance for Chipotle investors [4]. Five-Year Return - Investors who purchased Chipotle stock in December 2020 have seen a return of 29.3% over five years, which is significantly lower than the market's 86.5% return [5]. - An investment made on June 10, 2019, would currently outperform the S&P 500, with returns of 137.1% compared to 136.6% [5]. Investment Insights - Chipotle's stock exemplifies the benefits of long-term buy-and-hold investing in quality companies, as it has historically rewarded shareholders who maintain their investments despite short-term volatility [6].

Core Insights - Chipotle Mexican Grill and Wingstop reported Q3 2025 earnings, highlighting their distinct strategies in a challenging consumer environment [1] Company Performance - Chipotle Mexican Grill is navigating a more favorable trajectory compared to Wingstop, indicating differing operational strategies and market responses [1] - Wingstop's performance reflects the difficulties faced by some fast-casual chains in the current economic climate [1]

Core Insights - Chipotle Mexican Grill, Inc. (CMG) shares have dropped 34.6% over the past six months, significantly underperforming the industry and the S&P 500, which increased by 9.3% and 17% respectively, indicating serious concerns about traffic trends, margin pressures, and a stressed customer base [1][22]. Factors Hurting Chipotle - A broad decline in spending among households earning under $100,000, which constitutes about 40% of Chipotle's total sales, has negatively impacted the company. This demographic is facing inflation, unemployment pressures, and slower wage growth, leading to reduced dining frequency [7][8]. - Chipotle has experienced multiple step-downs in traffic throughout 2025, with significant declines noted in February, May, August, and October. Despite promotional efforts, the core traffic trajectory remains negative, raising concerns about the macroeconomic environment [9]. - Rising inflation, particularly mid-single-digit inflation due to higher beef costs and new tariffs, is pressuring margins. Chipotle is not fully offsetting these costs with price increases, which is compressing restaurant-level margins [10]. - Operational inconsistencies, especially in digital order accuracy, have affected customer satisfaction. The shift in incentive structures has led to a decline in accuracy scores, impacting repeat business [11]. - Elevated operating costs, driven by wage inflation and increased marketing investments, have further squeezed profits. The company has invested heavily in promotions to drive traffic, which has widened cost pressures [12]. Factors Likely to Aid Chipotle - Despite current challenges, Chipotle maintains a competitive value proposition, with pricing 20-30% below fast-casual peers. The company has retained stable wallet share, indicating consumer loyalty [13]. - Menu innovation is a key strategy for attracting new customers. New offerings have exceeded expectations, and management plans to increase the frequency of limited-time offerings in 2026 [14]. - Digital initiatives have proven effective in boosting customer engagement and loyalty, with plans to enhance the rewards platform to bring back inactive customers [15][16]. - Chipotle's long-term growth strategy includes opening 350-370 new restaurants in 2026 and expanding internationally, which supports confidence in reaching a target of 7,000 North American locations [17]. Chipotle Estimate Revision - Earnings estimates for CMG in 2026 have been revised down from $1.42 to $1.22 over the past 60 days, with expected year-over-year growth of 4.9%. In comparison, competitors like Darden Restaurants and CAVA are projected to see higher growth rates of 7.1% and 11.6% respectively [18]. Valuation - Chipotle's stock is currently trading at a forward 12-month price-to-earnings ratio of 28.14, which is higher than the industry average of 23.73 and the S&P 500's 23.41, indicating that the stock remains at a premium despite recent declines [19].

Core Points - Chipotle Mexican Grill will host a conference call on February 3, 2026, to discuss its fourth quarter and full year 2025 financial results and provide a business update for the first quarter of 2026 [1][2] - A press release with the financial results will be issued at approximately 4:10 PM Eastern time on the same day [1] - The conference call can be accessed via phone or through a live webcast on the company's investor relations page [2] Company Overview - Chipotle Mexican Grill, Inc. is focused on serving responsibly sourced, real food without artificial ingredients, with over 3,900 restaurants across multiple countries as of September 30, 2025 [3] - The company employs over 130,000 individuals and is recognized as a leader and innovator in the food industry, committed to making its food more accessible while emphasizing digital and sustainable business practices [3]

Industry Trends - Sweetgreen and Cava are facing challenges as consumers prefer more affordable and substantial food choices [1] - Even Chipotle's founder has shifted focus, indicating a potential change in market dynamics [1]

Core Insights - The podcast discusses the emotional pitfalls of selling stocks too soon, emphasizing that selling good companies prematurely can lead to significant missed opportunities for gains [2][4][12] - Historical examples, such as Netflix and Sea Limited, illustrate how selling decisions based on short-term performance can result in substantial long-term losses [3][5][10] - A framework for evaluating when to sell stocks is proposed, focusing on business fundamentals rather than emotional reactions to market fluctuations [12][14] Emotional Temptations of Selling - Investors often succumb to emotional impulses driven by fear and greed, leading to premature selling of stocks that may recover or grow significantly [2][3] - The pain of perceived losses is more intense than the pleasure of gains, influencing investors to sell stocks that are declining or have appreciated significantly [2][3] Historical Examples of Selling Mistakes - David Gardner's sale of Netflix in 2003 for valuation reasons resulted in a missed opportunity for 26,000% gains had he held onto the stock [3] - Sea Limited was sold in November 2023, missing out on 223% gains, despite logical reasons for selling at the time [5][10] Framework for Selling Decisions - A structured approach to selling stocks is recommended, including evaluating whether the decision is based on business fundamentals, macroeconomic factors, or valuation concerns [12][13] - Key questions to consider include whether the stock has reached a financial milestone or if the business is still aligned with the investor's thesis [12][13][14] Importance of Patience and Long-Term Perspective - Holding onto stocks that have the potential for significant growth can outweigh the risks of short-term volatility [10][11] - The concept of asymmetric returns highlights that the potential upside of successful investments can far exceed the downside risk [9][10] Lessons from Past Sales - The podcast emphasizes the importance of reflecting on past selling decisions to avoid repeating mistakes and to recognize the potential for recovery in previously sold stocks [6][16] - Building a habit of reviewing earnings reports and company fundamentals can help investors resist the urge to sell based on market noise [15][16]

Core Insights - Chipotle Mexican Grill has launched a holiday promotion called "Unwrap Extra," which includes BOGO (Buy One Get One) entrée offers on the first three Saturdays of December, aimed at encouraging customers to share meals together [1][3][7] - The promotion also includes surprise rewards for Chipotle Rewards Members, such as free guacamole, double protein, chips, or drinks, delivered directly to their accounts [4][7] - Chipotle is partnering with No Kid Hungry to raise funds for childhood hunger, allowing customers to round up their orders to donate to the cause, with over $825,000 raised since the beginning of 2024 [5] Promotion Details - The BOGO offers are scheduled as follows: - December 6: Buy three tacos, get a free entrée - December 13: Buy a burrito, get a free entrée - December 20: "Extra Sweater Day" where wearing an "extra" sweater allows customers to receive a BOGO offer [8][6] - The promotion is valid in-restaurant only, and specific conditions apply for each offer [6][8] Company Overview - Chipotle operates over 3,900 restaurants across the U.S., Canada, the U.K., France, Germany, and the Middle East, and is known for its commitment to responsibly sourced ingredients and sustainable practices [9] - The company employs over 130,000 individuals and is recognized as a leader in the food industry, focusing on enhancing customer experience and digital innovation [9]

Core Insights - Chipotle Mexican Grill's Q3 2025 earnings report showed adjusted earnings per share (EPS) of 29 cents, beating the Zacks Consensus Estimate of 28 cents, while revenues of $3 billion missed the estimate of $3.02 billion by 0.5% [2][3] Financial Performance - The bottom line increased by 7.4% from 27 cents reported in the year-ago quarter [3] - Quarterly revenues rose 7.5% year-over-year, driven by new restaurant openings and an increase in comparable restaurant sales [3] - Comparable restaurant sales rose 0.3% compared to a 6% growth in the prior-year quarter, aided by a 1.1% increase in average check, offset by a 0.8% decrease in transactions [4] Restaurant Openings - Chipotle opened 84 company-owned restaurants in the third quarter, with 64 featuring a Chipotlane, contributing to the company's performance [5] Cost and Margin Analysis - Food, beverage, and packaging costs as a percentage of revenues were 30%, down from 30.6% in the prior-year quarter, due to menu price increases and cost efficiencies, though partially offset by inflation and tariffs [6] - The restaurant-level operating margin was 24.5%, down from 25.5% in the prior-year period [7] Net Income and Balance Sheet - Adjusted net income for the quarter was $389.9 million, compared to $366.6 million in the prior-year quarter [7] - As of September 30, 2025, cash and cash equivalents were $698.7 million, down from $748.5 million as of December 31, 2024 [8] 2025 Outlook - Management anticipates comparable sales to decline in the low-single digit range, with plans to open between 315 and 345 new company-operated restaurants, over 80% featuring a Chipotlane [10] Estimate Trends - There has been a downward trend in fresh estimates, with the consensus estimate shifting down by 12.44% [11] VGM Scores - Chipotle has a Growth Score of B but lags in Momentum with an F, and a D on the value side, resulting in an aggregate VGM Score of C [12] Overall Outlook - Estimates have been trending downward, leading to a Zacks Rank 4 (Sell), indicating expectations of below-average returns in the coming months [13]