Chipotle Mexican Grill (NYSE:CMG) Chipotle has been one of the best-performing restaurant stocks of the past 15 years. Early investors have seen big gains on small investments, but new investors should also be encouraged by Chipotle’s recent performance and how it’s impacting its stock price-earnings multiple.
Earnings per share have grown 540% over the past five years. This strong increase in profitability has driven the stock price up 346%, turning a $10,000 investment into a $44,670 return. As management remains focused on improving profitability through a growing store base, the stock price is likely to continue to rise.
Chipotle can continue to grow
Chipotle delivered another stellar first-quarter earnings report, with revenue up 14% year over year and adjusted earnings up 27%. Management expects full-year same-store sales to grow in the mid-to-high single-digit range, which should lead to double-digit growth in revenue and earnings.
Management is focused on driving profitable growth for shareholders, which is why investors should be excited about the company’s plans to accelerate store openings.
The company opened 47 new stores in the first quarter, bringing its total to about 3,500 across the U.S., Canada, the U.K., France and Germany. The company plans to open 285 to 315 new stores this year toward its long-term goal of 7,000 stores in North America.
Chipotle has proven itself to be a top-tier restaurant company, having weathered a major crisis over food-related illnesses linked to its restaurants in 2015 and, more recently, a pandemic and skyrocketing inflation.
If restaurants can overcome these challenges, they’ll likely continue to generate profits for shareholders for years to come.
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John Ballard has no position in any of the stocks mentioned. The Motley Fool owns shares in and recommends Chipotle Mexican Grill. The Motley Fool has a disclosure policy.
If You Invested $10,000 In Chipotle Mexican Grill Stock Five Years Ago, Here’s How Much You’d Have Today originally appeared on The Motley Fool.
