Traders Watch Yum! Brands (YUM) as Chipotle (CMG) Eaten Alive on Outlook

January 16, 2013 8:07 AM EST
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Price: $405.20 -0.9%

EPS Growth %: -54.8%

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Yum! Brands (NYSE: YUM) shares are on watch following guidance out of Chipotle Mexican Grill (NYSE: CMG) today.

Earlier, Chipotle said it expects fourth-quarter 2012 EPS of $1.92 to $1.97, versus consensus views calling for EPS of $2.09. Revs of $699.2 million outpaced the $690.9 million consensus. Food costs are expected to increase 130 basis points.

The news is a boon for Greenlight Capital's David Einhorn, who commented in Octoberthat he saw downside in store for Chipotle, while lauding Yum! at the same time. Einhorn added Chipotle to his list of short ideas.

Other analysts have taken similar views, warding off chatter in 2012 that Yum! and its Taco Bell brand would see significant interference from Chipotle.

Ahead of the bell Wednesday, Chipotle is down over 9 percent while Yum! is flat.

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