Chipotle Stock Craters After Alarming Q3: Analysts Slash Price Targets On Fading Consumer Appetite

• Chipotle's shares plunged nearly 19% on Thursday before slightly recovering in the after-market session.
• Major brokerages lowered their price targets on CMG stock, citing limited visibility into sales improvement, though some acknowledged the brand's strength.
• Stocktwits sentiment held up in the 'extremely bullish' zone.

Chipotle Mexican Grill's shares tumbled 18.8% on Thursday — their steepest drop in more than a decade — before recovering slightly in after-hours trading, amid a wave of bearish analyst commentary and price target cuts.

Brokerages revised their view on CMG stock after the burrito chain slashed its 2025 comparable sales forecast for a third time and missed the target for the third quarter.

What Do Analysts Say?

Goldman Sachs lowered the stock target to $45 to $52; JPMorgan lowered it to $40 from $44; and Morgan Stanley revised it to $50 from $59, among similar actions from others, according to investor note summaries on The Fly.

Goldman Sachs, which maintained a 'Buy' rating, said near-term inflationary headwinds and industry-wide macro pressures will persist, but added that there is an opportunity for the brand to re-accelerate transaction growth in the long term.

JPMorgan, on the other hand, stated that there is limited visibility into a same-store-sales recovery, which keeps "the lid" on the stock's valuation. The research firm reiterated its 'Neutral' rating.

Chipotle is pointing to a lower starting point for next year, according to Morgan Stanley analysts. Traffic can be fixed over time, and the unit growth story is "intact for a good brand," but the bull case is "pushed out," they said.

As of Thursday, 27 of the 36 analysts had a 'Buy' or higher rating on CMG, with the rest recommending 'Hold,' according to Koyfin. Their average price target $46.24 implies an upside of over 42% from the stock's last close.

Retail Investors' View

On Stocktwits, the sentiment for the stock has held in the 'extremely bullish' zone since late Wednesday.

"$CMG Millions of Darkpool Money floating in buying the shares. If you sold at panic, I got some advice for you, stock market ain't your cup of tea. This was the opportunity to add on and average down," remarked one user.

Chipotle on Wednesday said it is seeing particular weakness among low- and mid-income users and those under 35, a major demographic base for the restaurant chain.

With Thursday's slide, the CMG stock has tumbled 46% this year to $32.53, its lowest level since March 2023.

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