Shares of Chipotle Mexican Grill (NYSE:CMG) have soared 52% over the past year and have tripled from the lows hit last March, but Piper Sandler analyst Nicole Miller Regan says there's a lot more to come from the restaurant chain. On Tuesday, she raised her price target on the Mexican-food leader to $1,835 per share.
In a research note to investors, the analyst said Chipotle was moving from strength to strength and is "turning the page of recovery to an accelerated growth chapter."
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The restaurant industry was devastated by the COVID-19 pandemic as lockdowns and stay-at-home orders cleared out dining rooms. Chains that had an established off-premise business fared better than their sit-down counterparts, and though you could sit down at table at Chipotle, it was mostly set up as a grab-and-go operation.
Miller Regan contends the restaurant stands ready to capitalize on its product innovation, development pipeline, and productivity gains at its new restaurants. For example, Chipotle just introduced a cauliflower rice dish that aims to tie into the healthier low-carb trend, and at the start of the year when consumers are still sticking to their New Year's resolutions to lose weight, it could be a popular item.
The analyst already had an elevated price target of $1,745 per share, 32% above Chipotle's $1,319-per-share closing price yesterday, but her new target level suggests there's about 40% upside still in the Mexican-food joint's stock.