Running Head: CHIPOTLE MEXICAN GRILL

Chipotle Mexican Grill

Stock Price Valuation

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Chipotle Mexican Grill Closing stock price

The current upward trend for Chipotle stock is towards an effect of the company’s strong

financial performance over the past few months (Is Chipotle Stock A Buy Right Now, After Its

First Coronavirus Earnings Report?). This is commendable as the growth rate has accelerated for

the past few several years indicating that the company is richly rewarding its investors with high

stock gains. Despite its high financial performance, the company does not pay dividends to its

stakeholders. This report uses Chipotle closing stock price as from 10th February to 10th May

2020. The closing price of a stock often gives a standard benchmark which is used by various

investors in tracking the financial performance of a stock in a given period of time. This

information was retrieved from yahoo finance website: Chipotle Mexican Grill, Inc. (CMG)

https://finance.yahoo.com/quote/CMG/history/

The following graph was deduced after analysis with excel spread sheet. It should be

noted that the stock does not trade during the weekends, hence all weekends were excluded

during the analysis.

Chipotle Stock Price

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0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
- 2 -2 - 2 - 2 - 2 - 2 - 2 - 2 - 2 -2 - 2 - 2 -2 -2 -2 - 2 - 2 - 2 - 2 - 2 - 2
ay ay Apr Apr Apr Apr Apr Apr Apr ar ar ar ar ar ar ar ar F eb Feb Feb Feb
M M - - - - - - - M M M M M M M M - - - -
8- 5- 30 27 22 17 14 8 3 31- 26- 23- 18- 13- 10- 5- 2- 26 21 18 12
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The closing stock on February 10th was at $ 890.51 as shown. There was an increased

trend during the first week as shown up to 17th Feb 2020. A small growth rate of the stock price

showed up to 19th Feb where the stock reduced marginally. There was a reduction in the closing

price of the stock despite some relative ups’ and downs’ up to the midweek of 16th March to 23rd

March 2020. This shows various factors that could lead to the constant decrease of Chipotle

Stock which are discussed below. As from the midweek of 16rd March 202, it is clearly shown

from the graph, there was a relative increase in the stock price up to 27th Mar 2020. A relative

constant growth was observed from the very day up to 3rd April 2020. Thereafter the stock price

increased despite, again, the ups’ and downward trends in price. There was a marginal increased

in between 21st April to 23rd April. This showed that some factors triggered an increase in the

stock price during the three days. Thereafter the closing stock price showed a relative constant

growth up to 6th May 2020. However at the end of this 10the Feb to 10th May period, the stock

closed with a value of $ 925.83. This was an increase by $ 35.32.

The above analysis shows that Chipotle stock price increased by 3.97% during the three

month period. Chipotle delivered better than expected results, even though industry volatility

was unprecedented due to coronavirus pandemic. Sales from the same store fell by 2.76% in

March from the previous month because the outbreak caused several restaurants to offer only

shopping or to close completely. In April and May, however, there was strong growth and

comparable-sales for the whole month. Chipotle offered no driving order because sales improved

impressively. The success of the business is driven mainly by its investment in digital

distribution channels that allow individuals to order online. The pandemic has kept most

consumers home since activity exploded. However, like many other companies Chipotle has
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withdrawn its financial projections for the fiscal year 2020, citing the pandemic’s uncertainty (Is

Chipotle Stock A Buy Right Now, After Its First Coronavirus Earnings Report?).

Conclusion.

Mexican Chipotle Grill is back after a deep dive during the coronavirus bond crash. This is like

Deja vu, because the stock has registered higher levels since food safety concerns have been

overcome in the past few years (Danışoğlu, & Güner, 2018). Right now, the CMG stock is not a

buy stock, but its resilience in basic and technical matters shows that it's the investor should look

deep into it. For now, the potential purchase point for Chipotle is $ 925.83, or even a small

amount above the left. However, if it forms a handle, it could create an early entry.
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References.

Retrieved from: Chipotle Mexican Grill, Inc. (CMG)

https://finance.yahoo.com/quote/CMG/history/

Retrieved From: Is Chipotle Stock A Buy Right Now, After Its First Coronavirus Earnings Report?

https://www.investors.com/research/chipotle-stock-is-it-a-buy-right-now-earnings-charts/

Danışoğlu, S., & Güner, Z. N. (2018). Do price limits help control stock price volatility?. Annals of

Operations Research, 260(1-2), 129-157.