Chipotle Mexican Grill, Inc. (CMG - Free Report) is leaving no stone unturned to drive business even amid the ongoing COVID-19-induced crisis. Chipotle and Uber Eats recently announced a delivery partnership in Canada. Following the news, the company’s shares gained 3.3% on May 14. In the past six months, the company’s shares have surged 23.5%, against the industry’s decline of 10.8%.
This delivery plan will enable customers to order Chipotle food through the Uber Eats app and ubereats.com in Canada. Chris Brandt, Chief Marketing Officer said, “We're continuing to find ways to leverage key partners to grow our delivery footprint for Canadian customers.”
Both the companies are working together to enhance the delivery experience for customers amid the pandemic. Notably, Uber Eats users can leave a note in the app for "no-contact" deliveries.
Digitalization to Drive Growth
Chipotle is prioritizing its e-commerce program to gain customer confidence. The company has been making every effort to make digital ordering more appealing to customers and more efficient for its restaurants, in order to drive digital sales and retain customers during the coronavirus crisis. Toward this end, Chipotle has redesigned and simplified its online ordering site, enabled online payment for catering, online meal customizations and collaborated with several well-known third-party providers for delivery. It also announced a successful delivery partnership with Uber Eats in the United States in the first quarter.
The company’s rewards program has been another key growth driver. It has more than 11.5 million enrolled members. Over the past month, daily sign-ups spiked nearly four-fold, reflecting reapid adoption of its digital platform. In first-quarter 2020, digital sales soared 81% year over year to $372 million and accounted for 26.3% of sales. The company has increased focus on digital and delivery services owing to the shutting down of the dine-in facility in the wake of the virus outbreak. As a result, digital sales for the month of March grew 102.6% year over year and represented 37.6% of sales.
Chipotle currently has a Zacks Rank #5 (Strong Sell).
Stocks to Consider
Some better-ranked stocks worth considering in the same space include Domino's Pizza, Inc. (DPZ - Free Report) , Wingstop Inc. (WING - Free Report) and Yum China Holdings, Inc. (YUMC - Free Report) . All these stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Domino's Pizza, Wingstop and Yum China have an impressive long-term earnings growth rate of 12.5%, 11% and 9.5%, respectively.
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