Chipotle Mexican Grill (NYSE: CMG) stock soared more than 10% on Wednesday after RBC Capital Markets reiterated its bullish stance on the company.
The equity research firm maintained an ‘Outperform’ rating and a $70.00 price target for CMG, highlighting confidence in the company’s long-term prospects despite near-term headwinds.
The analyst acknowledged challenges in the first half of 2025, including tough year-over-year comparisons and broader macroeconomic pressures. These factors may limit Chipotle’s ability to counter bearish sentiment in the coming quarters.
However, the analyst pointed to several strengths supporting the bullish outlook. Among them are Chipotle’s pricing power, a compelling consumer value proposition, and ongoing improvements to throughput — all seen as key drivers of future growth.
The report also addressed the potential impact of rising tariffs, suggesting that Chipotle could benefit from consumers seeking more affordable dining options. Compared to competitors like Sweetgreen (NYSE: SG) and Cava (NYSE: CAVA), Chipotle’s offerings are seen as more cost-effective in a potentially inflationary environment.
In addition, RBC noted investor interest in Texas Roadhouse (NASDAQ: TXRH), as the stock trades about 25% below its November 2024 peak. However, the attention and conviction surrounding Texas Roadhouse appear less pronounced than the positive sentiment toward Chipotle, said the firm.
Chipotle (NYSE: CMG) stock is currently trading at a price-to-earnings multiple of 41.9x, with analyst targets ranging from $46 to $72. While the stock has declined more than 10% in the last six months, it continues to see robust revenue growth, which stood at 14.6% over the past year.
The company is set to report its next earnings on April 23, 2025.
Jennifer Tacker is a staff writer at ABBO News. She holds a B.A. from the University of Waterloo and a B.Ed from Western University. Jennifer has been active in the stock market and crypto sector for a decade. She specializes in technical analysis and trading strategies. Read Full Bio
