Shareholders might have noticed that Chipotle Mexican Grill, Inc. (NYSE:CMG) filed its quarterly result this time last week. The early response was not positive, with shares down 4.8% to US$50.82 in the past week. Chipotle Mexican Grill reported US$3.0b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$0.33 beat expectations, being 5.4% higher than what the analysts expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Chipotle Mexican Grill after the latest results.
Taking into account the latest results, the most recent consensus for Chipotle Mexican Grill from 32 analysts is for revenues of US$11.3b in 2024. If met, it would imply an okay 6.4% increase on its revenue over the past 12 months. Per-share earnings are expected to accumulate 5.1% to US$1.08. Before this earnings report, the analysts had been forecasting revenues of US$11.4b and earnings per share (EPS) of US$1.11 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.
It might be a surprise to learn that the consensus price target was broadly unchanged at US$63.50, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Chipotle Mexican Grill analyst has a price target of US$80.00 per share, while the most pessimistic values it at US$40.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 13% growth on an annualised basis. That is in line with its 15% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 9.7% annually. So although Chipotle Mexican Grill is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Chipotle Mexican Grill. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at US$63.50, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Chipotle Mexican Grill going out to 2026, and you can see them free on our platform here.
Plus, you should also learn about the 1 warning sign we've spotted with Chipotle Mexican Grill .
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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