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Chipotle: Solid Earnings, but the Stock Is Too Hot to Handle

TheMotleyFool

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Chipotle: Solid Earnings, but the Stock Is Too Hot to Handle

Chipotle Mexican Grill (NYSE: CMG) rang up another quarter of solid growth to close out 2020, even as the pandemic continued to weigh on sales. Furthermore, management said that sales growth has improved in January and will likely accelerate further as year-over-year comparisons ease starting in March.

Indeed, investors can expect Chipotle to post strong growth and meaningful margin expansion over the next two years as the pandemic recedes. Nevertheless, Chipotle stock appears to be dramatically overvalued after roughly quintupling over the past three years.