Peter Smith
● Barchart pointed out—with a touch of humor—that Chipotle Mexican Grill ($CMG) just hit its lowest price in two and a half years, continuing a brutal post-earnings slide. The stock closed Wednesday at $39.76 (down 1.24%), then cratered another 9.96% after hours to $35.80, per Barchart.com data.
● The tweet joked about "guacamole portion sizes," but the real story is investor anxiety about Chipotle's growth outlook. The plunge comes after recent quarterly results showed squeezed margins, sluggish same-store sales, and weakening demand as consumers pull back. Analysts say premium fast-casual chains are getting hit hard by inflation—rising food costs and wages are eating into profits.
● From a technical perspective, Wednesday's drop blew through a key support level around $40 that had previously held strong. "Once $CMG broke below that floor, the algorithms took over," one technician noted. The after-hours carnage suggests investors are rethinking whether Chipotle's premium valuation still makes sense given its current growth trajectory.
● Still, not everyone's giving up. Chipotle leads in digital sales and customer loyalty, and its international expansion could pay off down the road. But until the company shows it can protect margins without constantly raising prices, expect more turbulence.
● The selloff highlights the broader pressure on consumer stocks as spending habits shift and money flows into safer sectors. For Chipotle, the next earnings report will be crucial—it'll either signal this was just a rough patch, or the beginning of something worse.
Peter Smith
