Traders Purchase Large Volume of Call Options on Chipotle Mexican Grill (NYSE:CMG)

Chipotle Mexican Grill, Inc. (NYSE:CMG) was the target of some unusual options trading activity on Thursday. Stock investors purchased 54,598 call options on the company. This is an increase of 28% compared to the average volume of 42,571 call options.

Chipotle Mexican Grill Stock Down 3.1%

CMG stock opened at $37.31 on Friday. The business has a 50 day moving average of $32.85 and a 200 day moving average of $34.62. The firm has a market cap of $47.86 billion, a PE ratio of 34.23, a price-to-earnings-growth ratio of 2.49 and a beta of 0.97. Chipotle Mexican Grill has a twelve month low of $28.03 and a twelve month high of $44.27.

Chipotle Mexican Grill (NYSE:CMG) last announced its quarterly earnings results on Wednesday, July 29th. The restaurant operator reported $0.33 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.32 by $0.01. The company had revenue of $3.35 billion for the quarter, compared to analysts’ expectations of $3.33 billion. Chipotle Mexican Grill had a net margin of 11.43% and a return on equity of 54.65%. Chipotle Mexican Grill’s revenue was up 9.3% compared to the same quarter last year. During the same quarter in the previous year, the business posted $0.33 EPS. On average, research analysts expect that Chipotle Mexican Grill will post 1.14 earnings per share for the current fiscal year.

Wall Street Analysts Forecast Growth

Several research analysts have commented on the stock. Mizuho upped their price objective on shares of Chipotle Mexican Grill from $40.00 to $41.00 and gave the stock an “outperform” rating in a report on Monday, July 13th. Sanford C. Bernstein reaffirmed an “outperform” rating on shares of Chipotle Mexican Grill in a research note on Friday. Guggenheim reiterated a “neutral” rating and set a $36.00 price target (up from $35.00) on shares of Chipotle Mexican Grill in a research report on Friday. Zacks Research raised shares of Chipotle Mexican Grill from a “strong sell” rating to a “hold” rating in a research note on Friday, April 17th. Finally, DA Davidson raised their price objective on shares of Chipotle Mexican Grill from $45.00 to $50.00 and gave the stock a “buy” rating in a report on Thursday. Twenty-four equities research analysts have rated the stock with a Buy rating, eight have given a Hold rating and one has issued a Sell rating to the company. Based on data from MarketBeat.com, the company currently has a consensus rating of “Moderate Buy” and a consensus target price of $43.98.

Chipotle Mexican Grill News Roundup

Here are the key news stories impacting Chipotle Mexican Grill this week:

• Positive Sentiment: Chipotle reported second-quarter adjusted EPS of $0.33, slightly above the $0.32 consensus, while revenue rose 9.3% year over year to $3.35 billion, broadly ahead of expectations. Chipotle Mexican Grill Stock Rallies as Q2 Results Top Fears, Guidance Rises
• Positive Sentiment: Comparable restaurant sales increased 2.2%, supported by improving customer traffic, menu innovation, digital engagement and restaurant expansion. Management raised its full-year comparable-sales outlook, signaling confidence that momentum is continuing. Chipotle shares rise on quarterly earnings beat, raised outlook
• Positive Sentiment: Analysts remained constructive following the results. DA Davidson raised its price target to $50 and maintained a Buy rating, while BTIG, TD Cowen and Mizuho also retained positive recommendations; Mizuho lifted its target to $43.
• Neutral Sentiment: Unusually heavy call-option activity and multiple price-target revisions indicate heightened investor interest, but these signals can also contribute to short-term volatility rather than establish a lasting trend.
• Negative Sentiment: Management said sales softened late in July amid consumer concerns about a cyclospora outbreak, although Chipotle stated it was not involved in the outbreak. The traffic disruption has raised questions about the durability of the recovery. Chipotle lifts its sales forecast even as a lettuce-linked outbreak slows foot traffic
• Negative Sentiment: Investors also remain concerned about labor and other operating costs pressuring margins. Piper Sandler lowered its target to $39 and Morgan Stanley and Stephens kept more cautious equal-weight ratings, limiting the stock’s upside after its sharp earnings-related advance.

Institutional Inflows and Outflows

Several hedge funds have recently made changes to their positions in the stock. Revolve Wealth Partners LLC raised its stake in Chipotle Mexican Grill by 4.7% during the 4th quarter. Revolve Wealth Partners LLC now owns 4,804 shares of the restaurant operator’s stock valued at $290,000 after buying an additional 214 shares during the last quarter. City State Bank raised its stake in shares of Chipotle Mexican Grill by 13.4% in the fourth quarter. City State Bank now owns 2,330 shares of the restaurant operator’s stock worth $86,000 after buying an additional 275 shares during the period. Groupama Asset Managment raised its stake in Chipotle Mexican Grill by 1.9% during the 4th quarter. Groupama Asset Managment now owns 15,596 shares of the restaurant operator’s stock worth $568,000 after acquiring an additional 291 shares during the period. Cromwell Holdings LLC raised its position in shares of Chipotle Mexican Grill by 7.4% during the 4th quarter. Cromwell Holdings LLC now owns 4,295 shares of the restaurant operator’s stock valued at $159,000 after purchasing an additional 295 shares during the period. Finally, Catalyst Financial Partners LLC increased its stake in Chipotle Mexican Grill by 4.6% in the 4th quarter. Catalyst Financial Partners LLC now owns 6,763 shares of the restaurant operator’s stock worth $250,000 after buying an additional 298 shares in the last quarter. 91.30% of the stock is owned by hedge funds and other institutional investors.

About Chipotle Mexican Grill

Chipotle Mexican Grill is a fast-casual restaurant company known for its Mexican-inspired menu of burritos, bowls, tacos and salads. Founded in 1993 by Steve Ells, the chain emphasizes fresh, customizable meals made from a limited menu of core ingredients and a focus on ingredient quality. Chipotle operates primarily company-owned restaurants and offers dine-in, takeout, catering and delivery through its own digital platforms and third-party partners.

The company is headquartered in Newport Beach, California, and traces its roots to Denver, Colorado.