Can 2Q16 Results Help Chipotle’s Falling Share Price?



1Q16 performance

Chipotle Mexican Grill (CMG) is set to announce its 2Q16 results on July 21 after the market closes.

Chipotle reported a loss for the first time in its history in 1Q16. The measures taken by Chipotle’s management after an E. Coli outbreak in October 2015 failed to regain customer loyalty. This issue led to a decline in investor confidence as well as Chipotle’s share price. Since the company’s 1Q16 results on April 26, its share price has fallen 10.4% from $445.9 to $399.7. Notably, Chipotle’s share price hit a three-year low of $384.8 on July 14.

Between April 26 and July 8, Panera Bread (PNRA) and Shake Shack (SHAK) fell 1%, and 4.3%, respectively, while Brinker International (EAT) rose 4.5%.

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Series overview

This pre-earnings series will explore what you can expect from Chipotle’s 2Q16 earnings release. The series covers analysts’ estimates for revenue, EBIT (earnings before interest and tax) margins, and EPS (earnings per share). To wrap up the series, we’ll look at the company’s valuation multiple and the expected stock price over the next 12 months.

First, let’s start by discussing Chipotle’s revenue expectations for 2Q16.


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