The fast-casual Mexican restaurant Chipotle (CMG 3.87%) is coming off a tough showing in 2025, with the stock down nearly 32% over the past year. It also doesn't look like the company is in for a major bounce back, either. Management on the company's recent earnings call guided for flat year-over-year same-store sales growth in 2026.
When companies are struggling, management teams typically don't sit idle and wait for things to return to normal. Most try to adapt to get things back on track, and that's exactly what Chipotle is doing.
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Toward the very end of 2025, the company unveiled new menu items targeted at a whole new customer base, including a high-protein menu that features a double high-protein bowl with 81 grams of protein in it and an Adobe Chicken Taco, which will cost $3.50 and have 15 grams of protein.
Chipotle has hinted that part of this move is to attract a newer segment of the market that now uses GLP-1 drugs, a class of appetite-suppressant treatments for weight loss. Can this move turn things around for the struggling company?
Trying to meet a new market
The quick surge of GLP-1 use has certainly scared many restaurants about traffic declines because the drugs significantly curb one's appetite. A poll from the Kaiser Foundation found that one in eight adults is now taking a GLP-1 drug, which are becoming more affordable and accessible.
Chipotle's CEO, Scott Boatwright, is clearly aware of the new trend. "I think having a taco at $3.50 and a protein cup around $3.80 across the country is really an approachable price point that really gives the consumer a meaningful way into the brand, but also solves for those people that are looking for a different choice, whether they're GLP-1 users or looking for other dietary restrictions, more high protein or high fiber," Boatwright said on Chipotle's recent earnings call.
NYSE: CMG
Key Data Points
I think Chipotle's move certainly makes sense and could help address the traffic declines the chain has experienced over the past year. After all, a significant portion of Chipotle's customer base is high-income earners, a cohort also more likely to try GLP-1 drugs, primarily due to the cost.
But I think it's too early to say that this will definitely be the solution to Chipotle's problems. The company has seen a decline in consumer spending among all cohorts, so there could be macro issues at work too.
Furthermore, the stock is not cheap, trading at 34 times forward earnings. I think investors should monitor these developments and look for signs that they are working. But I don't think they need to rush into the stock at this time.
