Chipotle Mexican Grill is not only a healthy option for customers, but it also offers a low-priced and fast casual experience. It has had one of the highest estimated growth rates at 5.4%, which is very similar to that of the restaurant chain Panera Bread [U.S Restaurant’s 3rd Quarter..WSJ]. Chipotle Mexican Grill’s five year revenue trend and yearly net income has substantially increased, therefore proving the company’s overall success [CMG Annual Income Statement 2012]
Chipotle Mexican Grill’s balance sheets had been negatively affected during the 2008-2009 recession, which is similar to that of other players in the industry such as Panera Bread [Panera Bread 3rd-Quarter]. During the recession period, Chipotle and Panera Bread had experienced loss in profit compared to recent years. When observing the stock prices of these restaurants, a trend appears in 2008-2009 where the prices had significantly shown to decrease [Stock:Chipotle Mexican Grill 2012]. Although Chipotle and Panera had experienced loss during the recession, they are still very much upcoming restaurants in the industry because they present the new fast-casual trend. I believe that although growth had declined during the recession years, there is still much opportunity within these restaurants for profit because they offer low prices, fast service and a casual dining experience. Therefore, I found that restaurants in which offer a fast casual experience are becoming increasingly successful as this type of dining experience has slowly become more popular amongst consumers [Growth for Fast Casual Restaurants Remains Strong].
The companies that are sharing good news in their financial reporting are Chipotle Mexican Grill inc., Panera Bread Inc., Starbucks Corp., and Darden Restaurants Inc [CMG, DRI, PNRA, SBUX Annual Income 2012]. These restaurants in the quick-service sector have higher growth and revenue rates, while casual, upscale dining restaurants seem to be lagging behind [U.S. Restaurant’s 3rd Quarter..WSJ]. As stated before, I believe quick-service restaurants are experiencing the largest growth and advancement because they are starting to provide healthy and low-priced options for customers who no longer have the income to eat at restaurants that offer the full dining experience. I am very optimistic about this sector of the restaurant industry because it has proven itself to be very fruitful.
CMG Annual Income Statement - Chipotle Mexican Grill Inc. (2012). Annual Financials. (n.d.).MarketWatch - Stock Market Quotes, Business News, Financial News. Retrieved from http://www.marketwatch.com/investing/stock/cmg/financials
DRI Annual Income Statement - Darden Restaurants Inc. Annual Financials. (2012). (n.d.).MarketWatch - Stock Market Quotes, Business News, Financial News. Retrieved from http://www.marketwatch.com/investing/stock/DRI/financials
PNRA Annual Income Statement - Panera Bread Co. Cl A Annual Financials. (2012).MarketWatch - Stock Market Quotes, Business News, Financial News. Retrieved from http://www.marketwatch.com/investing/stock/PNRA/financials
SBUX Annual Income Statement - Starbucks Corp. Annual Financials. (2012.).MarketWatch - Stock Market Quotes, Business News, Financial News. Retrieved from http://www.marketwatch.com/investing/stock/SBUX/financials
U.S.Restaurants' 3rd-Quarter Same-Store Sales Growth Seen at 2.8% - WSJ.com. (n.d.).Business News & Financial News - The Wall Street Journal - Wsj.com. Retrieved from http://online.wsj.com/article/BT-CO-20120918-710661.html
Stock:Chipotle Mexican Grill (CMG). (2012). See your portfolio in a whole new light - Wikinvest. Retrieved November 6, 2012, from http://www.wikinvest.com/stock/Chipotle_Mexican_Grill_(CMG)
Growth for Fast Casual Restaurants Remains Strong - QSR magazine. (n.d.). Quick-Service and Fast Casual Restaurant News and Information - QSR magazine. Retrieved from http://www.qsrmagazine.com/george-green/fast-casual-still-future?microsite=9344
Panera Bread 3rd-Quarter Net Up 27% on Stronger Same-Store Sales - WSJ.com. (n.d.).Business News & Financial News - The Wall Street Journal - Wsj.com. Retrieved from http://online.wsj.com/article/BT-CO-20121023-714934.html
I think it is just a matter of time until we see Chipotle very high up on the stock market food chain. Especially with college students, I feel like Chipotle offers a good, authentic meal that hits the spot when you are in the mood for Mexican. The modern, healthy, and organic feel just by walking past a Chipotle makes you think twice before walking past it! However, I think a recession poses a bigger threat to Chipotle then, say, Panera or Starbucks, because Chipotle caters to such a specific taste and does not offer that comfy, sit-down-and-spend-a-couple-hours-here feel.
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