- Chipotle beat on revenue, comparable sales, and profits.
- Shares of the burrito chain had fallen as much as 65% since October 2015, when an E. coli outbreak that was linked to Chipotle expanded to multi-states.
- Shares have rebounded more than 100% since new CEO Brian Niccol was appointed in February 2018.
- Watch Chipotle trade live.
Chipotle on Wednesday reported fourth-quarter earnings that crushed Wall Street estimates, sending shares up 5.75% to $556.95 apiece.
Here are the key numbers, compared to what Wall Street analysts were expecting, according to Bloomberg data:
- Adjusted earnings per share: $1.72 versus $1.37 expected
- Revenue: $1.20 billion versus $1.19 billion expected
- Comparable sales: +6.1% versus +4.5% expected
Comparable restaurant sales improved primarily as a result of an increase in the average check size, which included a 3.3% benefit from menu price increases, according to the company.
“I’m very pleased to report strong fourth quarter results with 6.1% comparable restaurant sales growth that included 2% transaction growth,” said CEO Brian Niccol in a press release. “For the full year, Chipotle’s average unit volumes exceeded $2 million with digital sales surpassing half a billion dollars.”
He added: “The growth acceleration this quarter gives us confidence that our strategy is working. When we connect with guests through great operations, relevant marketing focused on Chipotle’s great taste and real ingredients, and provide more convenient access, they respond enthusiastically.”
Shares of the burrito chain had fallen as much as 65% since October 2015, when an E. coli outbreak that was linked to Chipotle expanded to multi-states. However, they’ve more than doubled since Niccol’s appointment in February of 2018.
Entering 2019, Chipotle’s biggest challenge was skyrocketing wages, just like many other restaurants, Niccol warned last month at the ICR Conference — an event with many restaurant executives and investors attending. At the time, he told Business Insider that Chipotle was considering raising prices to help combat the wage increases, but that investors shouldn’t panic.
“Every cost in the business is a challenge,” Niccol said. “The good news is we have a model that we can invest in our labor. And, we will use sales growth coupled with some pricing to handle it.”
Chipotle was up 19% this year through Wednesday.
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