Since Brian Niccol became the CEO of Chipotle (CMG - Free Report) in March, Chipotle’s stock price has only gone up. According to CNBC, Chipotle’s stock move has been based solely on Niccol’s reputation. Prior to Chipotle, Niccol was the CEO at Taco Bell, owned by Yum! Brands (YUM - Free Report) , where he changed the image of the restaurant for better.
From introducing mobile order and pay to opening restaurants around the globe, Niccol transformed Taco Bell into a lifestyle brand. Similarly, Niccol plans to do the same at Chipotle with his prior success to make it more of a youthful and culturally relevant brand.
Niccol’s Past Success
In the past three years, Chipotle was not doing so well. The stock fell to its lowest level following food safety concerns, and this was a day before Niccol was to be named CEO. The stock price was at $251.33 per share. As of today, Chipotle’s stock is sitting at $459.35 per share.
In a press release by Yum! Brands, the CEO, Greg Creed, thanked Niccol on his success of always keeping Taco Bell culturally relevant, innovative and accessible for customers. Along with changing the restaurants slogan and introducing creative new food items, Taco Bell’s sales were up 5% last year, growing nearly $500 million according to CNBC.
With Niccol’s optimistic qualities, he is known for encouraging employees to pitch any ideas they might have in return for creating an inclusive workplace. And, his past experience in consumer-focused businesses and relevant skill sets in areas like marketing and operations, Niccol can help address any of Chipotle’s primary issues, like from the food safety incidents, says David Tarantino, an analyst at Baird.
What Does the Future of Chipotle Look Like?
Currently, CMG is a #3 (Hold) on the Zacks Rank, with a VGM score of ‘B’. After its Q1 report with Niccol as CEO, Chipotle’s earnings surged over 33% year-over-year to $2.13 per share. Total revenue climbed as well by 7.4% to $1.15 billion.
With a new CEO who is experienced and dedicated as ever, consumers and investors alike can finally start to see Chipotle on a steady profitable trail. Recently, they also announced the addition of a few new menu items at their test kitchen in NYC, which could be a potential asset to the future success of the company as well.
With Niccol’s vision of rebranding Chipotle to be more young and fun, it could potentially become a go to spot, more than it already is for many food consumers.
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