Why a 50-for-1 Stock Split Is Not Game Changing for Chipotle Stock
Investors are cheering Chipotle Mexican Grill's (NYSE: CMG) stock following the announcement of its 50-for-1 stock split. The stock rose 4% in the following trading session, a possible sign of further interest in the stock.
However, the likelihood of this split fundamentally helping Chipotle shareholders is low due to the actual effects of such a move. Instead, investors should look to the core business factors that drove Chipotle higher over the last 18 years rather than this latest milestone.
Admittedly, the stock split sounds impressive on the surface. The fact that it plans this split in the first place is a testament to the fast-casual restaurant chain's long-term growth. Nonetheless, stock splits do not change the value of your position. If you own 100 shares of Chipotle, it may feel rewarding to see that turn into 5,000 shares. Still, the total value of your holdings will remain the same.
Source Fool.com
Chipotle Mexican Grill Inc. Stock
The stock is one of the favorites of our community with 70 Buy predictions and 1 Sell predictions.
With a target price of 2478 € there is potential for a 5300.46% increase which would mean more than doubling the current price of 45.89 € for Chipotle Mexican Grill Inc..
