Burritos Beat Burgers: Chipotle Delivers Healthy Revenues

On January 20th of this year, I featured Chipotle (CMG) as one of my Three Restaurants for the New Decade. At that point in time, CMG was trading at $98.06 per share. Today, Chipotle reiterated my thesis that burritos will one day become king of the health fast food market in this country. After hours, CMG is trading at $132.85, a 35.5% increase from where I called bullish long-term attention to it (in just 3 months!) Chipotle may just be the McDonald’s of the 2000’s. Ask any MCD investor what it was like owning MCD from 1980-2000 and they will smile at you and say, ‘stock growth and stock splits!’

During the quarter, Chipotle opened 20 new restaurants, bringing the total restaurant count to 976.

Revenue for the quarter was $409.7 million, up 15.6% from the prior year period.

Net income for the first quarter of 2010 was $37.8 million, or $1.19 per diluted share, compared to $25.4 million, or $0.78 per diluted share, in the first quarter of 2009.

Here’s the breakdown from today’s earnings release:

Highlights for the first quarter of 2010 as compared to the first quarter of 2009 include:

  • Revenue increased 15.6% to $409.7 million
  • Comparable restaurant sales increased 4.3%
  • Restaurant level operating margin was 26.1%, an increase of 260 basis points
  • Net income was $37.8 million, an increase of 49.1%
  • Diluted earnings per share was $1.19, an increase of 52.6%

Outlook

For 2010, management expects the following:

  • 120-130 new restaurant openings
  • Mid single digit comparable restaurant sales growth

Founder & Chairman and Co-CEO Steve Ells, “We’re extremely proud of our first quarter results, and we’re delighted to see more customer visits to Chipotle after a year where the tough economy impacted us. These strong financial results only strengthen our commitment to our vision to change the way people think about and eat fast food by serving great tasting food made from higher quality and more sustainable raw ingredients.”

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