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Chipotle: Credit Suisse Initiated Coverage with ‘Outperform’ Rating

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Jun. 25 2019, Updated 1:27 p.m. ET

Credit Suisse’s rating

On June 25, Credit Suisse initiated coverage on Chipotle Mexican Grill (CMG) with an “outperform” rating and a target price of $870, which implies a return potential of 20.1% from its stock price of $724.13 on June 24.

As reported by CNBC, Credit Suisse thinks that Chipotle’s initiatives positioned it appeal to targeted customers. The company has returned to a growth narrative instead of a recovery.

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Analysts’ recommendations

Overall, analysts favor a “hold” rating for Chipotle. Among the 32 analysts that follow the stock, 46.9% recommended a “hold,” 34.4% recommended a “buy,” and 18.8% recommended a “sell.” On average, analysts have given Chipotle a 12-month target price of $688.0, which implies a fall of 5.0% from its stock price of $724.13 on June 24.

Since Chipotle reported its first-quarter earnings on April 24, Piper Jaffray, BTIG, Wedbush, J.P. Morgan, Cowen and Company, and UBS have all raised their target prices. On May 23, BMO downgraded Chipotle from “market perform” to “underperform.” BMO lowered its target price from $675 to $620.

Peer comparison

Among the 31 analysts that follow McDonald’s (MCD), 77.4% recommended a “buy” rating, while 22.6% recommended a “hold” rating. Analysts have given a 12-month target price of $216.92 for the stock, which implies a potential upside of 6.4% from its target price of $203.92.

Among the 11 analysts that follow Shake Shack (SHAK), 63.6% recommended a “buy” rating, 27.3% recommended a “hold” rating, and 9.1% recommended a “sell” rating. On average, analysts have given Shake Shack a 12-month target price of $60.75 with a potential fall of 9.0% from its stock price of $66.72.

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