I don't think anyone can accuse billionaire hedge fund manager David Einhorn of merely being lucky.
After getting the better of mutual fund icon Bruce Berkowitz when bashing The St. Joe Company (NYSE:JOE) two years ago and nailing the short thesis on Green Mountain Coffee Roasters (UNKNOWN:GMCR.DL) last year, Einhorn's knock this year on Chipotle Mexican Grill (NYSE:CMG) is off to another validating start.
Einhorn isn't lucky. He's just good.
His presentations at the annual Value Investing Congress are now the stuff of legend, and you can be sure that the market will be listening -- and reacting -- to whatever he decides to bet against next year. The more slides, the merrier (or scarier).
I, on the other hand, am a chump.
I didn't take sides publicly on Florida real estate mogul St. Joe, though I generally agreed with Einhorn's call at the time. St. Joe's stock is still trading 20% below where it was when Einhorn attacked, even with prices of Florida panhandle real estate finally moving higher and publicly traded developers marching back into investor fancy.
However, I was a critic of Einhorn's two subsequent calls.
"You're wrong," I countered last year after Einhorn took a bite out of Green Mountain's prospects and accounting practices.
He wasn't. Green Mountain has gone on to shed nearly 75% of its value as slowing sales and the now expired K-Cup patents have taken their toll.
I'm not ready to concede defeat entirely on this month's short thesis of Chipotle, but Einhorn clearly won the first round. When Yum! Brands reported that Taco Bell posted a 7% pop in same-store sales in its latest quarter -- fueled by the success of its slightly upscale Cantina Bell line -- I wanted to reserve judgment until Chipotle had the final word.
Well, Chipotle's mere 4.8% increase in comps during the same three months suggests that there may be some merit to Einhorn's argument. Most fast-casual chains would love to see the average store ringing up nearly 5% more in sales over the past year, but Chipotle was posting much heartier advances in recent quarters.
Perhaps more important, Chipotle's guidance points to generally flattish comps for the current quarter and for 2012.
Yes, Chipotle has historically been very conservative with its guidance. However, if there was ever a bad time for the company to prove itself mortal, it was this month after Einhorn ripped the restaurateur into carnitas shreds.
Well played, Einhorn.