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In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 3.6%. CMG’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 3.6%, as shown in the chart below.
Image Source: Zacks Investment Research
CMG’s Q4 Estimate Revisions
The Zacks Consensus Estimate for fourth-quarter earnings per share (EPS) has been unchanged at 24 cents in the past 30 days. The projected figure indicates a 4% decline from the year-ago reported EPS of 25 cents. The consensus mark for revenues is pegged at $2.99 billion, implying 5% year-over-year growth.
What the Zacks Model Unveils for CMG
Our proven model does not conclusively predict an earnings beat for CMG this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here.
CMG’s Earnings ESP: Chipotle currently has an Earnings ESP of -2.25%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Chipotle’s fourth-quarter 2025 revenues are likely to have been supported by continued momentum from menu innovation and limited-time offerings that carried into the quarter. Management highlighted that carne asada and the Red Chimichurri sauce generated a clear step-up in transactions and increased trial, with sauces in particular proving effective at attracting younger consumers and incremental visits. These offerings not only lifted average check through premium proteins but also encouraged repeat purchases, as data shows guests who buy LTOs tend to increase frequency and spend over time. This innovation-led demand likely helped cushion the impact of broader consumer pullbacks during fourth-quarter 2025.
Another key revenue tailwind was elevated marketing and promotional activity tied to loyalty and digital engagement. Chipotle accelerated marketing spend to around 3% of sales, using campaigns such as Chipotle IQ, Freepotle and rewards-based promotions to reengage pressured cohorts. Management noted that loyalty comps outperformed non-loyalty trends, suggesting these efforts helped drive incremental transactions even as underlying traffic remained soft. The continued emphasis on digital engagement and rewards activation is likely to have supported sales volumes through fourth-quarter 2025, particularly among younger and lower-frequency guests.
Unit growth and operational initiatives are also likely to have contributed to top-line resilience. Chipotle continued opening new restaurants at a strong pace, with new units delivering high initial productivity and outperforming the existing base. In parallel, early benefits from the rollout of high-efficiency equipment packages improved throughput, food quality and guest satisfaction in pilot locations. While still in early innings, these operational improvements are likely to have helped maximize sales during peak periods and supported revenue generation in fourth-quarter 2025.
Our model predicts Food and Beverage as well as Delivery Service revenues to increase 5.6% and 0.8% year over year, respectively.
Despite revenue supports, fourth-quarter 2025 earnings are likely to have been pressured by higher costs and margin headwinds. Management flagged a full-quarter impact of the premium carne asada LTO, rising beef prices and accelerating inflation driven by tariffs, all of which are expected to have pushed cost of sales higher in fourth-quarter 2025. At the same time, Chipotle chose not to fully offset inflation with pricing, prioritizing value for consumers.
Elevated labor costs from wage inflation, sustained marketing spend and higher G&A tied to growth investments might have further weighed on profitability, limiting earnings leverage despite ongoing sales growth. Our models predict restaurant operating costs to increase 6.4% year over year to $2,227.8 million.
Price Performance & Valuation of CMG
CMG stock has declined 33.6% over the past year compared with the industry’s decrease of 6.4%. In the same time frame, shares of other industry players like Domino’s Pizza, Inc. (DPZ - Free Report) , CAVA Group, Inc. (CAVA - Free Report) and Restaurant Brands International Inc. (QSR - Free Report) have declined 10% and 54.8%, and gained 8%, respectively.
Price Performance
Image Source: Zacks Investment Research
Analysts have expressed concerns that CMG stock is overvalued. The company is currently valued at a premium compared with its industry on a forward 12-month P/E basis. Its forward 12-month price-to-earnings ratio stands at 31.97, higher than the industry average.
P/E (F12M)
Image Source: Zacks Investment Research
Investment Thoughts for CMG
CMG appears to be at an important inflection point where the business fundamentals remain intact, but near-term risks outweigh the upside ahead of earnings. The company continues to benefit from strong brand equity, menu innovation, loyalty engagement and disciplined unit expansion, which support long-term growth and justify existing investors staying invested.
However, earnings visibility heading into the quarter is clouded by margin pressure from higher input costs, elevated labor and marketing spend, and management’s decision to protect value rather than push pricing. With estimates not moving higher and the earnings model failing to clearly signal a beat, the risk of disappointment remains.
At the same time, the stock already reflects a premium valuation relative to peers, leaving little room for upside surprise in the near term. As a result, current investors can afford to hold and let the strategy play out, but new buyers may want to stay on the sidelines until earnings provide clearer confirmation on margins and growth momentum.
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Chipotle to Report Q4 Earnings: Should You Buy Before the Breakout?
Key Takeaways
Chipotle Mexican Grill, Inc. (CMG - Free Report) is slated to release fourth-quarter 2025 results on Feb. 3, after the closing bell.
In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 3.6%. CMG’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 3.6%, as shown in the chart below.
Image Source: Zacks Investment Research
CMG’s Q4 Estimate Revisions
The Zacks Consensus Estimate for fourth-quarter earnings per share (EPS) has been unchanged at 24 cents in the past 30 days. The projected figure indicates a 4% decline from the year-ago reported EPS of 25 cents. The consensus mark for revenues is pegged at $2.99 billion, implying 5% year-over-year growth.
What the Zacks Model Unveils for CMG
Our proven model does not conclusively predict an earnings beat for CMG this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here.
CMG’s Earnings ESP: Chipotle currently has an Earnings ESP of -2.25%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Zacks Rank of CMG: The company carries a Zacks Rank #3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Factors Influencing CMG’s Q4 Performance
Chipotle’s fourth-quarter 2025 revenues are likely to have been supported by continued momentum from menu innovation and limited-time offerings that carried into the quarter. Management highlighted that carne asada and the Red Chimichurri sauce generated a clear step-up in transactions and increased trial, with sauces in particular proving effective at attracting younger consumers and incremental visits. These offerings not only lifted average check through premium proteins but also encouraged repeat purchases, as data shows guests who buy LTOs tend to increase frequency and spend over time. This innovation-led demand likely helped cushion the impact of broader consumer pullbacks during fourth-quarter 2025.
Another key revenue tailwind was elevated marketing and promotional activity tied to loyalty and digital engagement. Chipotle accelerated marketing spend to around 3% of sales, using campaigns such as Chipotle IQ, Freepotle and rewards-based promotions to reengage pressured cohorts. Management noted that loyalty comps outperformed non-loyalty trends, suggesting these efforts helped drive incremental transactions even as underlying traffic remained soft. The continued emphasis on digital engagement and rewards activation is likely to have supported sales volumes through fourth-quarter 2025, particularly among younger and lower-frequency guests.
Unit growth and operational initiatives are also likely to have contributed to top-line resilience. Chipotle continued opening new restaurants at a strong pace, with new units delivering high initial productivity and outperforming the existing base. In parallel, early benefits from the rollout of high-efficiency equipment packages improved throughput, food quality and guest satisfaction in pilot locations. While still in early innings, these operational improvements are likely to have helped maximize sales during peak periods and supported revenue generation in fourth-quarter 2025.
Our model predicts Food and Beverage as well as Delivery Service revenues to increase 5.6% and 0.8% year over year, respectively.
Despite revenue supports, fourth-quarter 2025 earnings are likely to have been pressured by higher costs and margin headwinds. Management flagged a full-quarter impact of the premium carne asada LTO, rising beef prices and accelerating inflation driven by tariffs, all of which are expected to have pushed cost of sales higher in fourth-quarter 2025. At the same time, Chipotle chose not to fully offset inflation with pricing, prioritizing value for consumers.
Elevated labor costs from wage inflation, sustained marketing spend and higher G&A tied to growth investments might have further weighed on profitability, limiting earnings leverage despite ongoing sales growth. Our models predict restaurant operating costs to increase 6.4% year over year to $2,227.8 million.
Price Performance & Valuation of CMG
CMG stock has declined 33.6% over the past year compared with the industry’s decrease of 6.4%. In the same time frame, shares of other industry players like Domino’s Pizza, Inc. (DPZ - Free Report) , CAVA Group, Inc. (CAVA - Free Report) and Restaurant Brands International Inc. (QSR - Free Report) have declined 10% and 54.8%, and gained 8%, respectively.
Price Performance
Image Source: Zacks Investment Research
Analysts have expressed concerns that CMG stock is overvalued. The company is currently valued at a premium compared with its industry on a forward 12-month P/E basis. Its forward 12-month price-to-earnings ratio stands at 31.97, higher than the industry average.
P/E (F12M)
Image Source: Zacks Investment Research
Investment Thoughts for CMG
CMG appears to be at an important inflection point where the business fundamentals remain intact, but near-term risks outweigh the upside ahead of earnings. The company continues to benefit from strong brand equity, menu innovation, loyalty engagement and disciplined unit expansion, which support long-term growth and justify existing investors staying invested.
However, earnings visibility heading into the quarter is clouded by margin pressure from higher input costs, elevated labor and marketing spend, and management’s decision to protect value rather than push pricing. With estimates not moving higher and the earnings model failing to clearly signal a beat, the risk of disappointment remains.
At the same time, the stock already reflects a premium valuation relative to peers, leaving little room for upside surprise in the near term. As a result, current investors can afford to hold and let the strategy play out, but new buyers may want to stay on the sidelines until earnings provide clearer confirmation on margins and growth momentum.