Chipotle shares up 10% after announcing its financials for the second quarter

Chipotle Mexican Grill (NYSE: CMG) stock went up 10% after announcing its second quarter financials for the year 2022. The fast-food chain known for its Mexican-inspired cuisine beat most analyst estimates by quite a considerable margin.

Chipotle tops analyst estimates 

Chipotle Mexican Grill recorded a $9.30 adjusted EPS in the second quarter, more than the $7.46 it reported in the same quarter of the previous fiscal year and topped the $9.09 consensus estimates. The company recorded $2.21 billion in total revenue in the same quarter, representing a 17% year-over-year increase. However, this was lower than the $2.25 billion consensus projection.

The fast-food conglomerate had a 10% increase in same-store sales, which was less than the 11% increase analysts estimated. The 15% operating margin was also less than the 15.7% analyst estimates, but more than the 13% it recorded in the same quarter of the previous financial year.

The company opened a total of 42 new locations by the end of the second quarter, representing a 25% year-over-year decrease and was also below the 53 consensus estimates. However, the fast-food chain expects to open around 235 to 250 new locations on a full-year financial basis, which is slightly more than the 248 analyst forecast.

Chipotle Chief Executive Officer and Chairman, Brian Niccol said:

Analyst comments and estimates 

Eric Gonzales, a Keybanc financial analyst slashed the price target from $1,900 to $1,750 but still remains positive when it comes to the CMG story.

In a note, Gonzalez told clients:

However, John Glass, a Morgan Stanley financial analyst, hiked the price target from $1,769 to $1,808 to reflect better financial margins. He claimed that further corresponding margin and incremental pricing actions will cause numbers to rise.