Why a Buyout Is the Worst Outcome for Chipotle Investors
Chipotle Mexican Grill (NYSE: CMG) could be a case study in reputational risk. After its Initial Public Offering (IPO) price of $22 per share, shares were on a tear for the greater part of a decade, cresting at approximately $760 per share in 2015. Soon thereafter, the stock came crashing down to earth as the company faced a series of foodborne illnesses, with the first outbreak infecting 55 people in 11 states. Later outbreaks fed into the greater narrative that the company's management was unable to fix the issue.
The company has taken a series of steps to remedy the situation, and parted ways with then co-CEOs Monty Moran and founder Steve Ells. Still, diners are not willing to give Chipotle Mexican Grill the benefit of the doubt. Last quarter, the company produced an anemic 1% comparable-restaurant sales increase, lower than meager expectations of 1.2%.
A recent report from Wall Street analyst firm Bernstein noted Chipotle could be a takeout candidate. For many investors, this is one of the worst possible outcomes.
Source: Fool.com
Chipotle Mexican Grill Inc. Stock
With 70 Buy predictions and 1 Sell predictions Chipotle Mexican Grill Inc. is one of the favorites of our community.
Based on the current price of 47.08 € the target price of 2478 € shows a potential of 5163.38% for Chipotle Mexican Grill Inc. which would more than double the current price.
