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With New Sales Outlook, Is Chipotle Finally Moving Past E. Coli Crisis?

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It seems like Winter Storm Stella didn’t affect Chipotle Mexican Grill Inc. (CMG - Free Report) . The burrito chain rose 2% to $405.42 after data-analysis firm M Science predicted first-quarter sales would easily beat Wall Street’s estimates.

The research firm came to the prediction after studying Chipotle’s same-store sales during February and the first 10 days of March and multiple data sets and proprietary models.

Bloomberg reported that analysts expect first quarter same-store sales to grow almost 15%. A huge sales growth prediction for the company, especially coming off a decline of 4.8% in the previous three months and the 30% plunge in the same period a year ago from a foodborne-illness outbreak.

On top of the positive sales growth, the Mexican food chain has been going through a transformation internally to draw back investors.

Aside from taking visible steps in showing customers that the restaurant is safe again from the food-safety scandal, the company announced last Friday that four members of the board would not stand for re-election in May. The company appointed four new directors in December, including one from Bill Ackman's Pershing Square Capital Management (PSHZF - Free Report) , Reuters reported.

Chipotle denied that the decision was the result of pressure from Ackman, a major shareholder, and activist investor. But many suspected otherwise.

The Mexican chain also reported its plan to close all 15 of its ShopHouse Southeast Asian Kitchen restaurants by March 17. The move of closing all ShopHouse comes as its recovery strategy from the massive food safety problem that the company suffered towards the end of 2015.

Though it may look like things are looking up for Chipotle, investors might want to wait before buying Chipotle's stock. However, investors should pay close attention to the company next month when its quarterly report is set to release in late April.

Chipotle is currently Zacks Rank #3 (Hold) with a style score "A" in momentum.

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