Chipotle Wrestles With Its Own Logic
Now that social-media tastemakers have rendered an overwhelmingly negative opinion of Chipotle Mexican Grill's (NYSE: CMG) queso offering, and some financial analysts project that the new menu item won't provide a much-needed lift to company sales, it's appropriate for investors to question what the flailing launch reveals about the current state of Chipotle's business.
To do so, it's useful to start with a bit of armchair reckoning. Imagine that the company had introduced queso in early 2015, a period when its stores still routinely hit double-digit comparable sales increases and words like "norovirus" had yet to make their way into the Chipotle lexicon. While the dip's success or failure probably wouldn't garner the attention we're seeing now, the stakes would still be fairly high.
That's because Chipotle is famously loath to aggressively alter its menu. The company controls its food and labor costs by maintaining an extremely basic lineup that relies on the perceived freshness and quality of ingredients as long-term customer attractors. Though each is easily customized, Chipotle's business nonetheless rests on a core set of five items: burritos, bowls, hard and soft tacos, and salads.
Source: Fool.com
McDonalds Corp. Stock
The stock is one of the favorites of our community with 57 Buy predictions and 1 Sell predictions.
As a result the target price of 292 € shows a positive potential of 26.0% compared to the current price of 231.75 € for McDonalds Corp..