Chipotle Mexican Grill (CMG) continue to rally despite Top analysts downgrade.

Chipotle Mexican Grill (CMG), continue to rally despite Top analysts downgrade.

CFO of Chipotle, Jack Hartung:

We think that the more people discover where their food is coming from, the more they will appreciate Chipotle, we care about our ingredients, how the animals are raised and treated. We care about the environment. We want to treat animals humanly. We want to make sure we don’t leave a foot print on the environment, and we want to make sure we serve food that tastes great as well. Most of our customers are still discovering that, and we think the more they discover about Chipotle philosophy and where all the food comes from, the more they will appreciate the experience at any of our Restaurants.

Chipotle is just not another restaurant, it’s the single best growth restaurant story out there, and despite the most top analyst recommendations to sell or hold, this stock just came bouncing back after the opening and kept on rallying afterwards.

The question is what makes this company growth unstoppable? And Why wall street top critics just don’t understand how Chipotle keeps on delivering great earnings?

The reason is rather simple! People are willing to pay more when knowing they get better food quality.

While analysts are bashing the industry all together because of higher commodity prices, this company offsets the higher food coast because it’s all ready price in the menu.
The company has over 1000 restaurants and plans to open by this year end another 130 Mexican restaurant and going to expand internationally in Europe and Canada.
for investors that means 1.48$ per share with 24.5 % upside earning for the year ago period.

So what makes Chipotle so special?

First the company does things that are very different from every restaurant company out there, and it starts with food integrity. Most restaurants are interested more in margins than the quality of the food. However, this restaurant has invested heavily in food since the beginning and constantly upgrading the quality of their food. This means their food cost is higher than any other restaurant company, typically that’s the kiss of death when a restaurant has very high food cost, they just can’t make the rest of their business work. However, because of very high volume and because Chipotle focuses on a very simple menu, they have been able to not only invest more in their food and charge a reasonable price, they actually have the highest margin in the industry, so they think about their business differently, they care about the ingredients they serve, and it ended up being a very good business model.

Chipotle wants to engage their most loyal costumers with a personal invitation. Every restaurant manager personally hands out to their most loyal costumers an invitation to join the loyalty program. This will allow these privilege customers to discover even more about Chipotle, and the more they discover the more they will appreciate the restaurant, and through word of mouth, people will discover more about the ingredients and what makes Chipotle so unique. The reward program may or may not be offered in food. It can be in hats, tea-shirts, and other things like that, which makes it very different than the typical loyalty program other restaurant offers.

So if you are looking for a great place to eat out or a great investment, then you should get in on this stock before it gets completely out of reach.