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Chipotle Mexican Grill (CMG) Gains As Market Dips: What You Should Know

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Chipotle Mexican Grill (CMG - Free Report) closed at $1,634.58 in the latest trading session, marking a +1.12% move from the prior day. This move outpaced the S&P 500's daily loss of 0.41%. Meanwhile, the Dow lost 0.55%, and the Nasdaq, a tech-heavy index, added 0.1%.

Prior to today's trading, shares of the Mexican food chain had lost 0.33% over the past month. This has was narrower than the Retail-Wholesale sector's loss of 4.15% and the S&P 500's loss of 5.13% in that time.

Chipotle Mexican Grill will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $9.05, up 28.92% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $2.23 billion, up 14.41% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $32.50 per share and revenue of $8.74 billion. These totals would mark changes of +27.85% and +15.79%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for Chipotle Mexican Grill. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.15% lower. Chipotle Mexican Grill currently has a Zacks Rank of #3 (Hold).

Digging into valuation, Chipotle Mexican Grill currently has a Forward P/E ratio of 49.73. For comparison, its industry has an average Forward P/E of 19.11, which means Chipotle Mexican Grill is trading at a premium to the group.

We can also see that CMG currently has a PEG ratio of 2.13. 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. CMG's industry had an average PEG ratio of 2.08 as of yesterday's close.

The Retail - Restaurants industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 185, putting it in the bottom 27% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

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