I just returned from field research for my short position. I ate lunch at a Chipotle in Lake Forest, California. Was there from 11:45 - 12:20, near the height of lunch hour on a beautiful, sunny day when many people were out and about.
Parking spaces near other businesses, shops and restaurants were filled to capacity, but parking availability near the Chipotle was plentiful. I parked right in front of the restaurant.
At most, eight tables were occupied during my visit; the restaurant was conspicuously empty and clean (from disuse).
Keep in mind that Lake Forest is in the heart of affluent South Orange County, CA.
As a comparison, at the same intersection there are two -- yes, two -- Del Taco franchises, one on the Chipotle side and the other directly across the street. Both of the Del Tacos were bristling with customers, especially the drive-throughs.
At Chipotle... the sound of crickets... well, the sound of synth-pop faux Mexican music blasted through the speakers.
I paid $8.51 for a bland burrito and a small soda.
Other customers during my visit at Chipotle were solitary guests, like me, and three couples. Chipotle is not a place where many families go to eat.
I am confident in my short position (500 shares at $348). Chipotle is a fad convenience restaurant that has already passed its apex. I expect earnings disappointments and lowered guidance in 2012.
On the door was a sign that Chipotle would be "wrapping up" early, closing at 8:00 p.m. on New Year's Eve. Chipotle management knows that its appeal is fading.
Yes, I know that location. Just north of I5 on El Toro. have eaten there. I don't have a position yet. Will buy put spreads on first strong downdraft. Will add if it breaks $300. Poor wrong way skiidady will lose his shirt.