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Chipotle Mexican Grill (CMG) Gains But Lags Market: What You Should Know

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Chipotle Mexican Grill (CMG - Free Report) closed at $1,379.03 in the latest trading session, marking a +0.5% move from the prior day. The stock lagged the S&P 500's daily gain of 1.54%. Meanwhile, the Dow gained 1.59%, and the Nasdaq, a tech-heavy index, added 0.98%.

Heading into today, shares of the Mexican food chain had gained 17.83% over the past month, outpacing the Retail-Wholesale sector's gain of 11.47% and the S&P 500's gain of 8% in that time.

Investors will be hoping for strength from CMG as it approaches its next earnings release, which is expected to be October 21, 2020. On that day, CMG is projected to report earnings of $3.25 per share, which would represent a year-over-year decline of 14.92%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.58 billion, up 12.42% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $10.85 per share and revenue of $5.96 billion. These totals would mark changes of -22.78% and +6.72%, respectively, from last year.

Any recent changes to analyst estimates for CMG should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 4.01% higher within the past month. CMG is currently a Zacks Rank #3 (Hold).

Investors should also note CMG's current valuation metrics, including its Forward P/E ratio of 126.49. This represents a premium compared to its industry's average Forward P/E of 35.34.

Investors should also note that CMG has a PEG ratio of 6.57 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Retail - Restaurants industry currently had an average PEG ratio of 3.72 as of yesterday's close.

The Retail - Restaurants industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 111, which puts it in the top 44% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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