Probably Chipotle had a lot of trouble making money when they were forced to give up illegals and had to hire American citizens.
Then, too, it was wildly over-priced relative to the earnings growth that was reported. CMG was a roller coaster waiting to drop.
Ever heard of Boston Chicken, Snapple, Krispy Kreme? Guess what, THE VERY SAME THING HAPPENED TO THEM: the mo-mo boys ran them up to the sky, relative to actual hard-dollar value, then they missed earnings or revenues targets, then ... blooey. Food and food service stocks and restaurant chains can only become bid SO high, and then, speaking both practically AND historically, look out below! Where have you been, laddiebuck?
Note to traders: Chipotle shares will likely rally in the short term, but they've a devil of a lot further to fall. I would strongly suggest looking at buying long-term put options, more or less at-the-money, on any rally.
Good trading to everyone!
I’m surprised they lasted as long as they did.
It only took one visit for me to swear off Chipolte forever, after paying top dollar for a terrible burrito that consisted of a tortilla filled with rice that was it for me.
But living in Arizona, i don’t have to put up with overpriced crap whose only resemblance to real Mexican food is that it’s rolled up in a tortilla. I guess most of the rest of the country doesn’t have any better options than the faux-Mexican garbage that Chipolte sells.
That is what happens when you offer up an overpriced yuppie version of Mexican food......
Restaurant-chain stocks always do this. They grow to the sky and then crash. The restaurants get old, there are few barriers to entry, and new competitors come along.
You want good stocks that don’t crash, pick industries which are hard for new competitors to enter. Oils, utilities, cigarettes.
This sounds like one Obama built.
That's quite a stretch to explain a drop in a stock price.
Here in NM, I had 2 carne asada tacos yesterday (at my awesome little dive mex restaurant) that filled me up for the whole day and cost less than $6. Fortunately, the restaurant didn’t have waterfalls and live mariachi music and I am the winner in that deal.
It is tough to compete with these little Mexican joints that are good. You need to be so much better and that is hard to do.
How do you pronounce “Chipotle?”
Their guacamole is too kill for...
Hope Chipotle crashes and burns. Remember this from 2011”
“Workers at Chipotle restaurants across the country might be making a run for the border soon.
The Mexican food chain, which serves gut-busting burritos, tacos and tortilla-less burrito bowls in nearly 1,100 locations across the U.S., fired hundreds of workers in Minnesota recently amid a probe by immigration authorities.
The workers were let go after an audit by the U.S. Immigration and Customs Enforcement Agency (ICE) revealed that workers at some of the 50 restaurants across the state had turned in phony-looking I-9 forms, which verify that a worker is eligible to work in the U.S.”
http://articles.nydailynews.com/2011-02-08/news/28550637_1_chipotle-burrito-immigration-policy
http://www.reuters.com/article/2011/04/13/us-chipotle-idUSTRE73C0P220110413
Too bad. Their food is actually pretty good and you get a huge amount of meat in the dishes. And it’s very Mexican...the dish isn’t spicy, but you can put a wide variety of sauces or toppings onto it that will make it the way you want it.
They started as a small operation somewhere (Chicago ?) and the were bought by McDonald’s and then let go,IIRC.
Could be because their food sucks.
Could be because their food sucks.
I like Chipotle but when we eat there it's easily forty bucks. WTH? Burritos used to be big and cheap.
If you like Chipotle, you may also like “Freebirds” which actually preceded Chipotle, but hasn’t grown nearly as much.
Mainly located in California and Texas.
http://en.wikipedia.org/wiki/Freebirds_World_Burrito
Chipotle is ANTI-GUN
When AZ allowed CCW holders to carry in establishments which serve alcoholic beverages, CBG posted No Weaons signs in accordance with that law.
I refuse to eat in gun free zones. We know how safe such places are, to wit: Aurora, CO. My pastor and church friends and some coworkers may have been discouraged when I told them.. This may have reduced business in gun-friendly AZ.. Cant say about the rest of the nation.
A few notes about Mexican food. To start with, Mexico has a lot of different cuisines, but what Americans think of when they think Mexican food is called “Sonoran”.
http://www.map-of-mexico.org/mexico-states.gif
Sonora is just the most northwestern state in Mexico, not including the two states of Baja. It has a border almost unique to Arizona. New Mexico and Texas border other Mexican states.
But it’s even more specialized than that. In effect, it could be called “inland Sonora”, because the cuisine along the West coast of Mexico is very heavily seafood oriented, and very different than what you think of when you think of Mexican food.
In Mexico, most food is cooked in lard, not vegetable oil, which is preferred in the US. So “authentic” Sonoran Mexican is considerably richer in taste. They also use Crema Agría (Mexican sour cream), which is somewhat stronger than sour cream and made from whole milk.
Queso Blanco (cheese) is also a very popular ingredient, but not cheddar. Hand made tortillas are usually better.
Mexican beef is often shredded instead of ground, and they prefer different cuts to their beef, like skirt steaks.
Most Mexican food in Mexico isn’t that good, and it’s over-priced.
Back in my wild days we had to shoot our way out of two donkey-bar Tijuana joints who insisted we leave an obscene tip.
Good Mexican food can only be eaten and enjoyed with a .357 strapped to your hip.
