No More $400 Burrito Stock (CMG)
When Chipotle Mexican Grill, Inc. (CMG) shares topped $400 anyone holding should have sold then. Chipotle crashed today like a classic momentum stock and shareholders got a wet burrito slap to the face.
Chipotle shares fell $86 today closing at $316 for a 22% decline. The love affair between Wall Street and Chipotle Mexican Grill is over. Traders crushed the stock after the company missed the quarter and warned there will trouble ahead.
Chipotle Mexican Grill's Q2 revenue hit $691 million. That's an impressive number but the Street expected $706 million and down the ship goes. To make matters worse, a record drought is likely to raise food prices this year and next, says Jack Hartung, Chipotle’s CFO.
MASTERY Bottom line:
Burritos hit the fan today and Mastery expects CMG to continue to trade volatile for the next week.
Let the dust settle before you consider taking a bite of Chipotle.
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