Shares of Chipotle Mexican Grill Inc. (NYSE: CMG) saw a handy gain on Tuesday, even though the company reported less-than-favorable preliminary numbers for the fourth quarter. It might seem like an oxymoron that shares would rally around a poor outlook, but Chipotle’s numbers are slowly but steadily improving from the E. coli outbreak that the burrito chain saw in 2015.
Comparable restaurant sales for the quarter decreased 4.8%, which includes the benefit of 0.5% related to previously deferred revenue that was recognized in the fourth quarter. Comparable restaurant sales decreased 20.2% in October 2016, decreased 1.4% in November 2016 and increased 14.7% in December 2016.
Despite these numbers looking horrendous, these sales comparisons are lapping an easier compare due to lower sales levels in November and December 2015.
The company also announced its preliminary fourth-quarter results. Chipotle anticipates reporting diluted earnings per share (EPS) in the range of $0.50 to $0.58. Final year-end accounting adjustments and related tax expenses may affect these estimates. Sales revenue for the quarter is expected to be $1.035 billion.
The consensus estimates from Thomson Reuters are $0.96 in EPS and $1.05 billion in revenue.
Chipotle also reported that its board of directors has authorized repurchases of common stock with a total aggregate purchase of $100 million. This repurchase is in addition to the previously announced authorizations totaling $2.1 billion. As of January 10, 2017, the current remaining authorization is $200.0 million.
And note that Chipotle’s Monty Moran was one of those CEOs forced out in 2016.
Over the past year, Chipotle has underperformed the broad markets, with the stock down nearly 4% (as of Monday’s close at $395.06).
Shares of Chipotle were last seen up over 5% at $417.18, with a consensus analyst price target of $393.39 and a 52-week trading range of $352.96 to $542.50.
Cash Back Credit Cards Have Never Been This Good
Credit card companies are at war, handing out free rewards and benefits to win the best customers. A good cash back card can be worth thousands of dollars a year in free money, not to mention other perks like travel, insurance, and access to fancy lounges. See our top picks for the best credit cards today. You won’t want to miss some of these offers.
Flywheel Publishing has partnered with CardRatings for our coverage of credit card products. Flywheel Publishing and CardRatings may receive a commission from card issuers.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
