Chipotle out of character in struggle to win back customers

Chipotle Mexican Grill, Inc., together with its subsidiaries operates Chipotle Mexican Grill restaurants.

Chipotle Mexican Grill posted their second-quarter sales and profit which missed the estimates of analysts.

Learn how you could trade stocks with 91% to 100% success rate by using this revolutionary indicator that predicts when certain stocks are on the move.

The Chipotle stock price is down a punishing 40% in the previous year, and we see shares falling even further in 2016. Although the top-line continued to suffer, Chipotle reported a return to profitability for the first time since the E.coli controversy. Over the recent months, it has been trying to regain its footing, but has failed to realize any significant upside. Cribstone Capital Management LLC purchased a new stake in Chipotle Mexican Grill during the second quarter valued at approximately $145,000. The program has three reward levels, with more visits translating to more free entrees and other benefits. The company, however, assures that it can reinvigorate sales and profit performance if only traffic rebounds at its restaurants.

Over the last twelve months Chipotle Mexican Grill, Inc.’s stock price has decreased by -42.4% from 725.82 to 418.07.

Analysts on average had expected earnings of 93 cents per share on revenue of $1.05 billion, according to Thomson Reuters I/B/E/S. The percentage difference between the actual EPS that the company posted in the last 12 months and the mean EPS estimate of $2.79 for the same period was 165.1%.

Total revenue, which factors in new store openings, declined to $998.4 million.

Comps marked third consecutive quarter for decline, crashing 23.6% this time.

Shares of Eagle Materials Inc (NYSE:EXP) have been given a consensus rating of 1.33 by brokerage analysts covering the stock.

Unfortunately for Chipotle, the same day that it added chorizo to its menus in select cities and rolled out Chiptopia, its chief creative and development officer Mark Crumpacker was indicted for allegedly purchasing drugs. The company lured customers to its restaurants with free offers, an effort that continues after last year’s health scare, and those promotions had an impact on margins.

The program, called Chiptopia, launched three weeks ago and it already has more than 3.6 million participants and accounts for 30% of all transactions. Results from the current program will be analyzed in order to devise another rewards program, which the company said will be introduced after Chiptopia ends in September.

“A full sales recovery to prior peak volumes could take years in our view, as evidenced by the fact that, according to our survey, approximately 25% of [Chipotle] customers either have stopped going or reduced frequency, even six months after the last reported food safety incident”, they wrote.