DA Davidson Raises Price Target on Chipotle Mexican Grill (CMG), Long-Term Outlook Remains Positive

DA Davidson is reiterating its Buy rating on shares of Chipotle Mexican Grill (NYSE: CMG) and is raising its price target from $360 to $400.

The company reported its second quarter results with earning increasing 9.2 percent year-over-year and revenue growth of 22.4 percent year-over-year, with revenue beating expectations by 10 percent. Margins feel slightly due to the rising costs in food.

Price increases in the Pacific region seem to be doing well and as a result the firm announced that by August the increases will be done nationally. The firm is anticipating that the price increases will be affective as it is the first in three years and the improved experience that CMG now offers.

Employee turnover raised 20 percent from its average 100 percent in Q2. DA Davidson comments that it is worth noticing but believes that it will drop back down due to the nature of the store and industry.

The firm is cutting its 2001 EPS estimate by $0.30 to $6.60 while raising its 2012 estimate by $0.15 to $9.15.

For more ratings news on Chipotle Mexican Grill click here and for the rating history of Chipotle Mexican Grill click here.

Shares of Chipotle Mexican Grill closed at $333.71 yesterday.

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