Morningstar

Chipotle CEO Search Signals Openness to Changes

While changes would take time to implement, new leadership could help to improve the brand-intangible asset behind Chipotle's narrow economic moat.

Securities In This Article
Chipotle Mexican Grill Inc
(CMG)

While

There is no change to our $350 fair value estimate or Standard stewardship rating; we will wait for the new CEO appointment before making changes to our longer-term assumptions. Our model continues to assume low- to mid-single-digit comps and a deceleration to mid-single-digit unit growth over the next five years (resulting in high-single-digit revenue growth), with operating margins recovering to the midteens over the same period (but below the high teens posted just a few years ago).

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About the Author

R.J. Hottovy

Sector Strategist
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R.J. Hottovy, CFA, is a consumer strategist for Morningstar Research Services LLC, a wholly owned subsidiary of Morningstar, Inc. He is responsible for consumer discretionary and staples research. He has covered the consumer sector as an analyst and director of global consumer equity research for Morningstar since joining the company in 2008, and specializes in a broad range of consumer categories including restaurants, footwear and apparel retailers, consumer electronics retailers, fitness clubs, home improvement and furnishing retailers, and consumer product manufacturers.

Before joining Morningstar, Hottovy was a director and senior stock analyst for Next Generation Equity and an analyst for William Blair & Co., specializing in a wide range of retail and consumer product companies. He also spent two years at Deutsche Bank, covering waste management, water utilities, and equipment rental stocks.

Hottovy holds a bachelor’s degree in finance and a second degree in computer applications from the University of Notre Dame, where he graduated magna cum laude. He also holds the Chartered Financial Analyst® designation and is a member of the CFA Institute and the CFA Society of Chicago.

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