Hollis Johnson
- Chipotle missed earnings and revenue expectations.
- Shares were down as much as 12% pre-market, and trading at their lowest level since 2013.
Shares of Chipotle are set to open at their lowest point since 2013 after missing big on earnings.
The company reported adjusted earnings of $1.33 per share compared to the Wall Street estimate of $1.63. Chipotle brought in $1.13 billion in revenue, missing the consensus estimate of $1.14 billion.
Shares cratered on in after-hours trading on Tuesday following the release. They were down about 12% in early trading on Wednesday to $288.06 a piece.
The company lowered its guidance for the year, saying it expects same-store sales growth of 6.5%, down from the high single digits, and guided toward the low end of its previously announced new store range of 195-210.
Andy Barish, an analyst at Jefferies, said that the company suffered from a norovirus outbreak that affected a single store in northern Virginia, but was actually helped by its queso, which was lambasted on social media.
"In spite of mixed reviews, the product is mixing about 15% and driving what appears to be mid single-digit same store sales lift from check average increase and some traffic," Barish said in a note to clients.
Barish lowered his price target to $300 from $350 after earnings.
David Palmer, an analyst at RBC wasn't as optimistic, as he said new initiatives, like the queso, add volatility to the company's earnings. He believes the new offerings, like queso, won't be as impactful for the company's bottom line as the company had hoped.
Palmer lowered his price target by $10 to $320 after earnings.
Chipotle is down 23.43% this year.
