Chipotle (CMG) Last Update 3/1/24
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Chipotle Company


  1. Company Operated Restaurants constitute 98% of the Trefis price estimate for Chipotle's stock.


Chipotle Beats Q1 Estimates

Chipotle's first-quarter earnings beat analyst expectations on both the top and bottom lines. The company's sales increased 17% year-over-year (y-o-y) to $2.4 billion in the first quarter of 2023, and comps increased 10.9%. The comparable sales mark was a notable sequential improvement from the +5.6% rate seen in Q4 and the strongest rate in more than a year. In-restaurant sales increased by 22.9% during the quarter. Operating income jumped to 15.5% of sales from 9.4% of sales a year ago and topped the consensus expectation of 14.0%. Consequently, the company's EPS was up 88% y-o-y to $10.50.

Looking Ahead

For the full-year 2023, Chipotle expects to open between 255 and 285 new restaurants. Though Chipotle said between 10 and 15 of these openings will be relocations in order for some restaurants to get a new location that includes a drive-thru. Management said it expects Q2 and full-year comparable restaurant sales to increase at a rate somewhere in the range of mid-single digits to high single digits year over year.

Continual Focus On Digital Initiatives

Digital sales continue to be strong at almost 39% of the core food and beverage business in Q1 2023, despite the return of in-person dining. Chipotle's highest-margin sales are digital orders, so momentum on this front serves the business well for continued profit growth in the long run. Chipotle's reward program (launched in Q1 2019) is gaining steam with an outstanding 31.6 million members (as of FY2022), wherein each purchase wins points that can be redeemed for food.


Below are key drivers of Chipotle's value that present opportunities for upside or downside to the current Trefis price estimate for Chipotle:

Company Operated Restaurants

Number of Restaurants : The company is still able to add new restaurants, and increase its in-restaurant sales - illustrating that the additions are not cannibalizing existing locations. The company saw the addition of net 419 stores between the end of 2020 and 2022. We continue to expect an average of 5% growth in stores each year over our forecast period.

Average Revenue Per Restaurant : We expect the company's revenues to grow at a steady pace over our forecast period, with average restaurant sales growing at around 7% over our forecast period.

For additional details, select a driver above or select a division from the interactive Trefis split for Chipotle at the top of the page.


Chipotle Mexican Grill is a chain of restaurants operating in the casual dining segment, which specializes in serving Mexican cuisine. As of Dec 31, 2022, the company operated 3,187 restaurants, almost all of which are located within the U.S. All the restaurants are company-operated with no franchises.

Chipotle's menu comprises Mexican fare with a few things that can be mixed and matched with various sauces and ingredients such as salsa, guacamole, cheese, and lettuce, to make one's dishes. The menu primarily consists of Tacos, Burritos, Salads, and Burrito Bowls (Burritos without the Tortilla).

Chipotle operates on the "Food with Integrity" principle, offering naturally raised pork, chicken, and beef. Naturally raised implies that the animals are raised in open pastures and are fed on a purely vegetarian diet without any added hormones or antibiotics.

Chipotle's objective is to provide a fine-dining experience in a quick-service setup and to provide quality food and ambiance without having the customer wait too long. Some Chipotle restaurants can serve up to 300 customers an hour.

Chipotle competes with restaurants in the casual dining segment such as Applebee's, Qdoba, Taco Bell, and Chili's, among others. It also competes with fast-food restaurants such as McDonald's, Burger King, Subway, and KFC.


Chipotle's business is wholly dependent on company-operated restaurants, which explains the significance of this division to its stock.

Higher average spend per customer than competitors

Chipotle enjoys a higher average spend per customer than most of its competitors, given its high quality of food. For example, in McDonald's, the average spend per customer is around $9, whereas the corresponding figure in Chipotle is about $11-12. The company has successfully marketed itself as a restaurant serving natural, hygienic, and organic food in an upscale ambiance, for which the consumers are often ready to pay a slight premium.

Another reason why the company enjoys a higher average spend per customer is that it has restaurants only in developed countries, where the average spend is usually higher than in developing countries. Most of the fast-food restaurant chains have a mix of restaurants in developed and developing countries, which has a lowering effect on the overall spending per customer.


Organic and healthier food gaining importance in the U.S.

Consumers have become more health-conscious, and there is an increase in demand for natural and healthier food. Using its 'Food with Integrity campaign, Chipotle has aggressively marketed itself as a restaurant using only naturally raised meat.