Same-store sales growth
Same-store sales growth is a key metric that investors and analysts closely follow when it comes to the restaurant business. Chipotle (CMG) experienced tremendous same-store sales growth in 2014, with most of its quarters reporting a double-digit growth. For the full year 2014 Chipotle reported a same-store sales growth of 16.4%.
- Following its high-performance 2014 results, Chipotle delivered a double-digit same-store sales growth in its first quarter of 2015, at 10.4%.
- However, this high growth did not seem sustainable, and the company’s 2Q15 same-store sales growth dropped to 4.3%.
- In the first two quarters, the same-store sales growth drop came from lower traffic growth, as shown in the chart above.
- In 2Q15, the company experienced traffic growth of -0.3%.
- In the upcoming 3Q15 quarter, Wall Street analysts are expecting 2.3% same-store sales growth.
- The company’s same-store sales growth has also trended with the food and drinking place retail sales growth, as you can see in the chart above.
- On a rolling three-month basis, food and drinking place retail sales growth also trended downward in the past two months. As of August 2015, it stood at 8.3%, down from 8.7% in 2Q15 and 9% in 1Q15.
- This further points toward expectations of a lower same-store sales growth for Chipotle in 3Q15.
- This does not necessarily mean negative results because the whole of 2015 is up for comparison against the double-digit growth in 2014. This makes 2014 a high benchmark for comparison.
To see how other restaurants such as Shake Shack (SHAK), Panera Bread (PNRA), and Habit (HABT) have performed in 2Q15, you may read Comparative Analysis of 8 US Fast Casual Restaurants.