Chipotle Mexican Grill (CMG) Gets a New Street-High PT of $2,600 at Piper Sandler
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Piper Sandler analyst Nicole Miller Regan reiterated an Overweight rating on Chipotle Mexican Grill (NYSE: CMG).
The analyst argues that investors should continue to own CMG, but also “put new money to work in CMG shares” as the stock represents Piper’s “highest conviction recommendation.”
“We reiterate our high degree of conviction around CMG shares as our top recovery investment recommendation as we remain confident that Chipotle is positioned to support recent top-line momentum and, over time, drive potential upside to consensus (and our) expectations,” Miller Regan said in a client note.
The analyst also raised the price target to a new Street-high of $2,600.00 from the prior $2,235.00.
“Our price target is now based on ~47x our FY22E EV/EBITDA estimates. The multiple is admittedly at the high-end of the historical range, but reflects our increased conviction in the Chipotle investment case. On a PE basis, it is in below the max, but above both the median and mean ranges. However, we find merit in the company’s best-in-class metrics across a series of sales, operations, cost margins, marketing, and long-term return categories. We still see a period of upside for CMG shares as the model transitions to compounding global growth,” the analyst adds.
Piper’s 2025 estimates point towards a minimum of $73.00 per share of earnings power. Furthermore, Miller Regan “sees a 6,000 domestic unit total addressable market period,” although this scenario can take as many as eight years to materialize (as CMG opens about 300 new stores a year.
Shares of CMG are up 0.6% in pre-open Thursday.
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Create E-mail Alert Related CategoriesAnalyst Comments, Analyst PT Change, Hot Comments
Related EntitiesEarnings, Nicole Miller Regan, Pre Market Movers
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