Chipotle: outlook disappoints; shares drop
(CercleFinance.com) - Shares in Chipotle Mexican Grill crumbled 10% today after the once-dynamic burrito chain said comparable restaurant sales would only increase in low single digits in 2018.
Sales at Chipotle restaurants that have been open at least 13 months rose 0.9% in fourth-quarter to 31 December, which is significantly below the comparable restaurant sales growth of 6.4% recorded for FY 2017.
Despite this, fourth-quarter net profit rose to 43.8 million dollars, or 1.55 dollar per diluted share, from 27.8 million, or 55 cents per share a year ago.
Chipotle also announced a string a new measures, such as bonuses, new training programs and expanded parental leave for its workforce of over 71,000, but this failed to impress investors.
"Shares seem likely to remain range-bound until the new CEO is hired and his/her strategic turnaround can be assessed by the market," Credit Suisse commented in a report to clients.
Shares in the restaurant chain were down 10.2% at 273.3 dollars in early morning trading on Wall Street. They have fallen by over 31% over the last 12 months.
Copyright (c) 2018 CercleFinance.com. All rights reserved.
Sales at Chipotle restaurants that have been open at least 13 months rose 0.9% in fourth-quarter to 31 December, which is significantly below the comparable restaurant sales growth of 6.4% recorded for FY 2017.
Despite this, fourth-quarter net profit rose to 43.8 million dollars, or 1.55 dollar per diluted share, from 27.8 million, or 55 cents per share a year ago.
Chipotle also announced a string a new measures, such as bonuses, new training programs and expanded parental leave for its workforce of over 71,000, but this failed to impress investors.
"Shares seem likely to remain range-bound until the new CEO is hired and his/her strategic turnaround can be assessed by the market," Credit Suisse commented in a report to clients.
Shares in the restaurant chain were down 10.2% at 273.3 dollars in early morning trading on Wall Street. They have fallen by over 31% over the last 12 months.
Copyright (c) 2018 CercleFinance.com. All rights reserved.