When Chipotle Mexican Grill Inc. (NYSE: CMG) released its third-quarter financial results after the markets closed on Thursday, the company posted $2.16 in earnings per share (EPS) on $1.23 billion in revenue That compared with consensus estimates of $2.00 in EPS and revenue of $1.23 billion, as well as the $1.33 per share and $1.13 billion posted in the same period of last year.
During the most recent quarter, comparable restaurant sales increased 4.4%. At the same time, digital sales grew 48.3% in the quarter and accounted for 11.2% of sales.
Restaurant level operating margin was 18.7%, an increase from 16.1%. The improvement was driven primarily by comparable restaurant sales increases and lower marketing and promotional cost, partially offset by increased repairs and maintenance.
Food, beverage and packaging costs were 33.4% of revenue, a decrease of 160 basis points compared to the third quarter of 2017.
Looking ahead to the 2018 full year, the company expects to see comparable restaurant sales increases in the low to mid-single digits. Consensus estimates call for $8.54 in EPS and $4.85 billion in revenue for the year.
CEO Brian Niccol commented:
Chipotle’s strategy to win today and cultivate a better future is taking hold and I’m pleased to report our third quarter results with strong sales growth and restaurant margin expansion over last year. We made important progress during the quarter with the introduction of our ‘For Real’ marketing strategy and I’m encouraged by the progress we are making in building a pipeline of customer focused innovation, driving digital sales, elevating our restaurant operations and effectively executing our reorganization.
Shares of Chipotle traded up 1.5% early Friday to $430.25. The consensus analyst price target is $468.04, and a 52-week trading range is $247.52 to $530.68.