Where Will Chipotle Stock Be in 5 Years?
If you invested $22 in (NYSE: CMG) stock (the price of two burritos) at its initial public offering (IPO) in 2006, you would have $3,155 today -- a jaw-dropping return of over 14,000%. The Mexican-inspired fast-casual chain has taken the restaurant industry by storm over the last two decades, and an ambitious stock-split plan promises to reignite optimism. But does the company have what it takes to maintain its market-beating performance? Let's dig deeper to find out.
After more than 20 years of incredible growth, Chipotle stock has become seemingly out of reach for many people -- particularly its employees, who might be hard-pressed to afford its $3,155 price tag. To fix this problem, CFO Jack Hartung is pursuing a 50-for-1 stock split that he believes will make it easier for line workers to buy the stock and for the company to reward its top-performing managers with specific increments of equity.
Generally, stock splits don't impact company fundamentals because they make shares cheaper without influencing market cap or valuation relative to earnings. But Chipotle's stock split is part of a larger strategy that could create shareholder value over the coming years.
Source Fool.com
Chipotle Mexican Grill Inc. Aktie
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