Shares of Chipotle Mexican Grill CMG gained nearly 0.7% in regular trading hours Thursday, continuing a good week that has seen the struggling stock recover over 5% in a matter of days.
Thursday’s trading action came on the back of the news that Chipotle is increasing its $1.9 billion stock buyback program by an additional $100 million. Chipotle instituted the repurchase program to help the stock recover from a slump that was initiated by a series of disease outbreaks related to Chipotle’s food.
Chipotle first announced its two quarter buyback program back on February 2, and since then the stock is down about 4%.
While buybacks are an option to boost a stock’s price, it is clear that Chipotle will need to start luring customers back into its restaurants. The company recently announced that it will be rolling out a new menu item—a “chorizo” blend of spicy pork and chicken—after it tested well last year.
Chipotle currently has a Zacks Rank #3 (Hold). Only time will tell whether the company’s new efforts will have a lasting effect.
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