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Chipotle (CMG) to Report Q4 Earnings: What's in the Cards?

Zacks Equity Research

Chipotle Mexican Grill, Inc. CMG is scheduled to report fourth-quarter 2019 results on Feb 4, after market close. In the last reported quarter, the company’s earnings surpassed the Zacks Consensus Estimate by 19.4%.

Q4 Expectations

The Zacks Consensus Estimate for fourth-quarter earnings is pegged at $2.75, higher than the year-ago reported figure of $1.72. Over the past seven days, the company’s earnings estimates have witnessed an upward trend by 0.7%. For quarterly revenues, the consensus mark stands at $1,401 million, suggesting growth of 14.2% from prior-year quarter.

Let’s check out how things have shaped up for the announcement.

Factors at Play

New menu innovation, continued use of technology and higher store opening are expected to have contributed to Chipotle’s comps growth in the fourth quarter. The company has been shifting its strategy from giveaways, discounts and rewards to new menu items, operational excellence, enhancement of guest experience, technology-driven convenience, and more aggressive brand marketing. These sales-building efforts are likely to have aided the company’s top line in the quarter to be reported.

However, wage inflation and higher marketing and delivery expenses are expected to have hurt margins in the to-be-reported quarter.

Chipotle Mexican Grill, Inc. Price and Consensus

Chipotle Mexican Grill, Inc. Price and Consensus

Chipotle Mexican Grill, Inc. price-consensus-chart | Chipotle Mexican Grill, Inc. Quote

What Our Model Says

Our proven model predicts an  earnings beat for Chipotle this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.  

Chipotle has an Earnings ESP of +3.25% and a Zacks Rank #2.

Other Stocks Poised to Beat Earnings Estimates

Here are some other stocks from the Zacks Retail-Wholesale space that investors may consider as our model shows that these too have the right combination of elements to post an earnings beat this quarter:

Denny's Corporation DENN currently sports a Zacks Rank #1 and has an Earnings ESP of +5.00%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Jack in The Box Inc. JACK carries a Zacks rank #2 and has an Earnings ESP of +4.92%.

Rite Aid Corporation RAD sports a Zacks Rank #1 and has an Earnings ESP of +52.63%.

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