Chipotle: A Reasonable Hunger

by

The stock charts, they’re like Rorschach tests, aren’t they? My aunt Mildred, she sees dancing bears. I mostly see a slow, creeping anxiety. Chipotle, specifically (CMG 3.71%), has been doing this little jig – down 42% from its peak, then a hopeful bounce. It reminds me of trying to parallel park on a busy street – a lot of frantic adjusting, and a lingering fear of denting someone’s fender. I’ve been circling it, mostly because my brother-in-law, Barry, keeps insisting it’s the future of fast-casual. Barry also believes in crystals, so, you know.

They reported decent numbers last quarter, but foot traffic was… flagging. Down in every single quarter of 2025. It’s like hosting a party and realizing no one actually likes your potato salad. A little disheartening. Still, the CEO, Scott Boatwright (a name that sounds suspiciously like a brand of sensible shoes), is talking a good game. He left Brian Niccol to go to Starbucks, which, frankly, seems like a lateral move. More coffee, more lines.

The Algorithm and the AUVs

Boatwright keeps mentioning this “algorithm.” It’s supposed to get them to $4 million in annual unit volumes (AUVs) and 30% margins. AUVs. It sounds like a military acronym. Apparently, it’s how much money each restaurant makes in a year. They’re currently at $3.1 million, across 4,042 stores. Simple math – and I’m terrible at math, so this felt like a genuine accomplishment – suggests a potential $28 billion in revenue if they hit their goal of 7,000 restaurants. That’s a lot of burritos. Enough to make one slightly nauseous just thinking about it.

I understand the skepticism. The market’s fickle. People are tightening their belts, especially the younger ones. Barry’s daughter, Tiffany, she’s a minimalist now. Everything has to be “sustainable” and “ethically sourced.” Which is fine, except she still expects me to bring the chips and dip to family gatherings. The hypocrisy is… striking. But Chipotle, they’re building new restaurants – 334 last year, with plans for 350-370 more. And these aren’t just any restaurants. They’re building Chipotlanes. Drive-throughs. It’s a brilliant, cynical move. Capitalizing on our collective desire for convenience, even if it means contributing to the slow, agonizing death of human interaction.

Loading widget...

A Reasonable Hunger

Since the pandemic, Chipotle has managed to grow. It’s impressive, really. Considering everything. Inflation, interest rates, the constant barrage of bad news. It’s like watching a dandelion stubbornly push through a crack in the sidewalk. You almost have to admire its resilience. And the price-to-earnings ratio is down 72% from five years ago. It’s not exactly a steal, but it’s… reasonable. Like a slightly dented but still functional toaster. I’m not saying rush out and mortgage your house, but it’s worth a look.

Barry, of course, thinks I’m overthinking it. “Just buy the stock, David,” he said. “It’s a sure thing!” Barry considers anything with a vaguely upward trajectory a “sure thing.” He once invested heavily in Beanie Babies. I still have a box of them in the attic, a monument to misplaced optimism. But maybe, just maybe, this is different. Maybe Chipotle isn’t a fleeting trend, but a solid, if slightly overpriced, investment. Or maybe I’m just hungry. It’s hard to tell, really. And sometimes, a reasonable hunger is enough.

Read More

2026-02-13 05:12