Your burrito may be getting a bit more expensive.
Chipotle Mexican Grill (CMG) is raising prices across the U.S., the company said Wednesday. “For the first time in over a year, we have taken a modest price increase of approximately 2% nationally to offset inflation,” Chipotle Chief Corporate Affairs Officer Laurie Schalow said in an email to Investopedia.
New Chief Executive Officer (CEO) Scott Boatwright, elevated to the top job last month, on the company’s most-recent earnings conference call in October said there was “nothing planned today, but that's not to say we wouldn't look at a pricing action at some point in the future.” A Wall Street Journal article last week alluded to the possibility of higher prices at Chipotle.
Shares of Chipotle were recently up more than 4%, leaving them almost 40% higher this year so far.
“The menu price increase is earlier than we … expected” and “a positive for the stock, in our view,” Truist Securities analysts wrote Wednesday. “We believe CMG is taking the menu price from a point of strength.” The analysts edged their price target on the shares up $2 to $74, a bit above Wall Street’s average of $68 per Visible Alpha data.
Wednesday afternoon, the stock was changing hands a bit below $64.
The effects of the menu price increases would likely be seen in the company’s fourth-quarter financial results, set for release in early February.
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