Why Chipotle is Poised to Underperform

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, burrito specialist Chipotle Mexican Grill (NYSE: CMG  ) has received a distressing two-star ranking.

With that in mind, let's take a closer look at Chipotle, and see what CAPS investors are saying about the stock right now.

Chipotle facts


Headquarters (founded)

Denver (1993)

Market Cap

$9.4 billion



Trailing-12-Month Revenue

$2.6 billion


Founder/Chairman/Co-CEO Steven Ellis

Co-CEO Montgomery Moran

Return on Equity (average, past 3 years)



$573.9 million / $3.6 million


Panda Restaurant

Qdoba Restaurant

Taco Bell

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 14% of the 3,195 members who have rated Chipotle believe the stock will underperform the S&P 500 going forward.

A couple of months ago, one of those Fools, badducky, showed skepticism over Chipotle's growth potential:

I think we're seeing the kind of saturation and copycatting competitors that makes huge expansion difficult. Naturally, this explains the Asian [ShopHouse] experiment. With no explosive growth realistically present with just burritos, they need to do the magic again with another restaurant brand. Being a successful and explosive restaurant chain is very, very hard to do once. Twice is not impossible, because the talent is present, but it is certainly not probable in the best of circumstances.

Of course, this short pitch doesn't even come close to telling the entire story for Chipotle. You're in luck, though. The Fool's brand new premium report on Chipotle tells all sides of the story for one of the most compelling restaurant plays in the world. You can grab your copy now, which comes with free updates for 12 months, by just clicking here.

Want to see how well (or not so well) the stocks in this series are performing? Follow the TrackPoisedTo CAPS account.

Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2192485, ~/Articles/ArticleHandler.aspx, 9/30/2016 4:52:46 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,308.15 164.70 0.91%
S&P 500 2,168.27 17.14 0.80%
NASD 5,312.00 42.85 0.81%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/30/2016 4:02 PM
CMG $423.50 Up +2.77 +0.66%
Chipotle Mexican G… CAPS Rating: ****