The Absurdity of Comparing Chipotle to a Taco Truck

Chipotle Mexican Grill (NYSE: CMG  ) bears have done it again. Hedge fund manager Jeffrey Gundlach has pointed out the potential threat posed to the burrito maker by low-cost food trucks -- specifically, taco trucks. Aside from the supposedly low barrier of entry, he believes the company's P/E is too high for what you get. In this video, Fool contributor Steve Heller sits down with Erin Miller to discuss why Chipotle is not just your average taco truck and why it will continue winning against the bigger fast-food names.

Chipotle's stock has been on an absolute tear since the company went public in 2006. Unfortunately, 2012 hasn’t been kind to the stock, as investors question whether its growth has come to an end. Fool analyst Jason Moser’s premium research report analyzes the burrito maker’s situation and answers the question investors are asking: Can Chipotle still grow? If you own or are considering owning shares in Chipotle, you’ll want to click here now and get started! 

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  • Report this Comment On May 20, 2013, at 9:03 PM, seattle1115 wrote:

    I don't know about your town, but where I live I can get far better quality food from a taco truck than I can from Chipotle, at 70% of the price or less, without driving to the mall - there are three such trucks currently parked within a mile of where I'm sitting. I'm not talking about some old-fashioned roach coach - I'm talking about award winning food as good as what I can get at any Mexican-themed fine dining restaurant in town. Maybe that's unusual; I don't know. I just know that, personally, I can't think of a single reason I would ever stop at Chipotle unless I just happen to be walking past one at the same moment that I'm overcome with a craving for a beef barbacoa torta.

  • Report this Comment On May 21, 2013, at 10:50 AM, jamiestp wrote:

    Here in Austin our taco trucks make a very strong stand to Chipotle and really any restaurant type at this point. Torchy's started out as a single truck and is on the verge of going national, 19 locations in Texas and spreading very quickly. It stomps chipotle all day long.

    Chipotle is a pretty unremarkable company with virtually no barrier to entry. They're so well established I don't think they're going anywhere. But the potential for future growth is limited as more enter the space they created.

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