Chipotle Gains As UBS Believes All Ingredients In Place For Upside By Investing.com

By Dhirendra Tripathi

Investing.com – Chipotle (NYSE:CMG) rose 1.5% Friday as UBS reiterated its buy on the stock with a $1,700 target, citing multiple factors for its bullish call.

Analyst Dennis Geiger’s target translates into an upside of almost 9% from the stock’s current level of $1,562.

According to Geiger, the chain has a lot going for it, starting with the 3.5% to 4% price increases it has taken with more hikes likely in the fourth quarter.

Recovering dine-in traffic, elevated digital sales, new product launches and other improvements are contributing to Chipotle’s competitive momentum, according to Geiger.

The analyst believes the price hikes should mostly cover the cost inflation and that margins will continue to expand over time.

Geiger listed share repurchase, greater international play and day-part expansion (breakfast and late-night) as strategic options before the company that could propel the stock.