Will Chipotle’s Digital Push Offset Flat Sales Guidance for 2025? (CMG)

• Chipotle Mexican Grill recently reported its second-quarter results, noting higher year-over-year revenue of US$3.06 billion but a smaller net income of US$436.13 million, and updated its 2025 guidance to reflect flat comparable restaurant sales after a softer quarter.
• Alongside its earnings update, Chipotle launched a Snapchat-based "AvoLotto" sweepstakes and expanded loyalty initiatives to boost customer engagement, reflecting ongoing investment in digital marketing and brand loyalty programs.
• We'll now explore how Chipotle's flat sales outlook and digital marketing efforts may alter its investment narrative and long-term growth thesis.

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Chipotle Mexican Grill Investment Narrative Recap

To own Chipotle stock, you have to believe in its ability to drive sustained restaurant expansion, strong unit economics, and meaningful brand engagement, even in times of choppy sales trends. The updated guidance for flat comparable sales and the recent “AvoLotto” digital push both reflect the company’s response to shifting consumer behavior, but the impact on the most important near-term catalyst, transaction growth, appears limited for now, while the biggest risk remains persistent macroeconomic pressures on consumer spending.

Among Chipotle’s latest updates, the announcement of plans to open 315 to 345 new restaurants in 2025 is especially relevant. Even with flat comparable sales, aggressive unit growth remains central to Chipotle’s long-term strategy, and serves as a key lever for future revenue and profit expansion despite near-term demand softness.

On the other hand, what investors should not ignore is the risk that if consumer sentiment does not rebound...

Read the full narrative on Chipotle Mexican Grill (it's free!)

Chipotle Mexican Grill's narrative projects $16.5 billion revenue and $2.4 billion earnings by 2028. This requires 12.6% yearly revenue growth and a $0.9 billion earnings increase from $1.5 billion.

Uncover how Chipotle Mexican Grill's forecasts yield a $58.60 fair value, a 37% upside to its current price.

Exploring Other Perspectives

Twenty members of the Simply Wall St Community provided fair value estimates for Chipotle ranging from US$36 to US$71.14 per share. With new store openings planned despite flat comparable sales, opinions differ widely about the company's near-term outlook, explore their varied views to understand what could drive future performance.

Explore 20 other fair value estimates on Chipotle Mexican Grill - why the stock might be worth 16% less than the current price!

Build Your Own Chipotle Mexican Grill Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Chipotle Mexican Grill research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.
• Our free Chipotle Mexican Grill research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Chipotle Mexican Grill's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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