Chipotle Mexican Grill (CMG) PT Lowered to $60 at UBS

UBS analyst Dennis Geiger lowered the price target on Chipotle Mexican Grill (NYSE: CMG) to $60.00 (from $65.00) while maintaining a Buy rating.

The analyst commented, "1Q results included sluggish sss, with pressures continuing 2QTD, while margins were modestly better and restaurant development remained solid. Primary focus is on expectations for a return to positive transaction growth in 2H, w/ support from multiple initiatives, but following lingering pressure YTD and a challenging macro that's impacting demand. Sales remain challenged into April due to industry headwinds, including weaker consumer spending, along with impacts from pricing roll off, an Easter shift, and tough comparisons (11.1% 2Q24). FY25 sss guidance was lowered to +LSD from +LSD-MSD as expected given the softness YTD, with debate around whether the guide was derisked enough. While we agree the onus is on CMG to accelerate trends closer toward ~MSD, w/ shares likely range bound in the interim, we believe it's too early to write off the potential for a rebound to ~MSD over time for a brand that has exhibited sss strength and consistency for so long until this uniquely challenged '25."

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