CMG bottom?

Just curious if anyone is still thinking about CMG, and if so, do you believe the stock has hit bottom? More of a question to those who use technicals, which I know little about. Fundamentally, I believe the prospects are good long term, but have succumbed to the technical believers to know if there is enough “strength” behind it before applying dry powder.


For me it is too still early to buy back in to CMG. We still don’t have the complete story on the norovirus/e-coli, and 4th quarter sales are going to PLUMMET. It will take a long time for customers to return to CMG so I see no need to invest right now. Also, why take the risk? There are so many rock bottom solid investments right now (SWKS, SKX, LGIH, INFN, SNCR) at firesale prices, so I would rather allocate capital to these stocks than to CMG.


Maybe a temporary bottom, but I still think that consumer sentiment will weigh on earnings negatively and there will be better prices to buy some in the next 3-6 months.

I know I still have no interest to go eat at a CMG yet.

I also don’t think the market in general is out of the woods yet, but at least things are looking more stable today and we held the bottom of the range

There are two Chipotles within walking distance of my office, and today at lunchtime they were both still virtually empty. I suspect it will take a year before we see same store sales numbers that aren’t negative. It is difficult to value a company that isn’t growing.

What the media did to Chipotle is unfair. Life is unfair.


Here is my CMG sob story:

Many years ago I bought 100 shares of CMG at something like $30 per share. When the share price rose to about $50 or so, I sold them because I felt I had locked in a pretty good profit.

The price per share went up significantly after that. I finally jumped back in several years ago when the price hit around $480. I was only able to buy 50 shares. So it cost me about $24k.

No doubt I was delighted when the share price continued to climb, and at one point would have had a profit of about $15k or so had I sold my shares.

However, during the recent waves of bad news regarding e. coli and novovirus, I foolishly bought 5 more shares at $604 per share, and then 5 additional shares at $548 per share. Catching a falling knife clearly has not worked out very well for me.

I don’t think I will be buying any more shares any time soon. As of today, I am “up” about $600 or so.

Regrets: selling CMG many years ago when it had only begun to take off; buying 10 additional shares of CMG in the last several weeks as the price continued to plummet.

Such a “Fool” am I? Or such a “fool” am I? I suppose at this point, only time will tell.


I know I still have no interest to go eat at a CMG yet.

That’s the bellweather question we have to ask ourselves before buying shares. If we wouldn’t be comfortable bringing our family to CMG for a meal, then we shouldn’t bring CMG to our portfolio.

And really, that’s a question we need to consider for any holding we contemplate. Although it’s a gut issue with CMG.



I agree with the posters who’ve stated that it’s too soon to invest in Chipotle. As a general rule, I don’t invest in restaurants. I broke the rule once, when a story erupted that Taco Bell was using horse meat (about three years ago). The share price plummeted. I bought in, thinking that it’s the kind of story that will be resolved (in one way or another) rather quickly. Sure enough, the claims were refuted quickly and the share price rose over 25% in short order. For me, it was an opportunistic trade. I pocketed the profits and walked away.

The CMG situation is different. There’s been no quick resolution. The reasons for the gastric distresses have neither been identified, nor resolved. It might take a while. The longer it takes, the worse it’ll be for Chipotle. I’ve no desire to invest in CMG under such circumstances. An investment in CMG may become profitable if the cause(s) are identified and resolved. In that case, CMG may regain customer confidence over time. Best to wait until the issues are resolved.

One thing to add though, for all the money flowing out of CMG, a lot of other restaurant stocks have been beaten down before the recent decline and have held up fairly well compared to the market YTD. The BWLD, LOCO, WING, DRI, CAKE, ZOES, etc and others like that may be worth consideration.

Don’t know much about their businesses as I don’t follow them except BWLD who I like, but I wouldn’t be surprised if there is a compelling idea there. I can imagine portfolio managers that want to keep allocations to that space will be shopping as well with some of the $ they took out of CMG

Food for though (yes, horrible pun intended)

This is not the bottom you’re looking for.

Move along.

Come back later.


This is not the bottom you’re looking for.

Thank you Smorgasbord, and everyone, for lending your insights. I think I too will wait a bit before testing the waters in CMG again.


I have no position in CMG. Chipotle’s problems are good for food and animal safety company Neogen (NEOG)

Business Summary
Neogen Corporation, together with its subsidiaries, develops, manufactures, and markets various products and services for food and animal safety worldwide.


Denny Schlesinger