Services

Chipotle Earnings Hammered by Same-Store Sales Guidance

Mexican foodChipotle Mexican Grill Inc. (NYSE: CMG) reported fourth-quarter and full-year results after the market closed Tuesday. The fast casual restaurant chain reported quarterly diluted earnings per share (EPS) of $3.84 on revenues of $1.07 billion. In the year-ago quarter Chipotle reported EPS of $2.53 on revenues of $844.15 million. The consensus estimates called for EPS of $3.79 on revenues of $1.07 billion.

For the full year, the company reported EPS of $14.13 on revenues of $4.11 billion, compared with EPS of $10.47 and revenues of $3.21 billion in the 2013 fourth quarter. Analysts were looking for EPS of $14.07 on revenues of $4.11 billion.

Same-store sales rose 16.1% in the quarter driven by more traffic and a price increase implemented last summer. Operating margins rose a point to 26.6% and food costs rose 1.1% to 35% of revenues. Higher prices for dairy and beef supplies drove the higher costs.

Same-store sales rose 16.8% for the full year and food costs amounted to 34.6% of revenues. Operating margin for the year came to 27.2%.

The company opened 60 new restaurants in the quarter and now claims 1,783 stores.

The company added $100 million to an existing total of about $98 million in its stock repurchase fund.

Chipotle expects to open 190 to 205 new stores in 2015 and further expects same-store sales to increase in the low- to mid-single digits. That is not such good news for investors coming on the heels of sales increases in the mid-teens. The company did not explain the drop but almost certainly will have to answer that question on the conference call.

CEO Steve Ells said:

We continue to make significant progress on our important journey to change the way people think about and eat fast food. Consumer trends are changing, which we believe is a great result of people becoming more discerning about where their food comes from, how it was raised, and how their meal was prepared.

The company’s shares traded down about 5.6% in Tuesday’s after-hours session, at $685.95 in a 52-week range of $472.41 to $727.97. The shares closed at $726.63. The consensus price target on the stock is around $745.50.

ALSO READ: States Where the Middle Class Is Dying

No Commission Fees, No Minimums, No Velvet Ropes. (Sponsored)

Robinhood revolutionized commission free investing, and it continues to do so today. With a few simple taps you can trade stocks like Nvidia and Amazon, market beating mutual funds, and trade options with Robinhood Financial. FDIC insurance coverage is just another benefit.

And, you can buy and sell cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), and Dogecoin (DOGE) with Robinhood Crypto.

Sign up today using the link below or click here to start your journey.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.