Chipotle Sinks After Sales Fall Short of Investor Estimates

(Bloomberg) — Chipotle Mexican Grill Inc. reported third-quarter sales that fell just short of Wall Street’s expectations, highlighting the high bar to which investors are holding the chain after it outpaced peers earlier this year.
Same-store sales, which measures performance at locations open for at least 13 months, rose 6% in the quarter, below the average analyst estimate of 6.4%. The company also forecast fewer new restaurant openings for next year than analysts were anticipating, according to a statement Tuesday. 
The shares fell 6% at 4:34 p.m. in extended New York trading. The stock advanced 32% in 2024 through Tuesday’s close, outpacing the S&P 500 Index over the same period. 
Chipotle’s performance is still enviable among restaurants, given that peers such as McDonald’s Corp. and Starbucks Corp. have reported several quarters of same-store sales declines. But investors have grown accustomed to eye-popping results from Chipotle, which has consistently managed to attract diners turned off by higher prices at fast-food chains and sit-down restaurants. 
In the third quarter, the burrito chain drove growth in both transactions and average checks, helped by hype around its smoked brisket limited-time offer.
Chipotle said its food and packaging costs rose as a percentage of total revenue in the quarter, in part because of higher prices for avocados and dairy. It also used more ingredients to ensure “consistent and generous portions” after it faced accusations from customers online that it was skimping.
The company maintained its earlier full-year view that same-store sales will rise in the mid- to high-single digit range. 
(Updates share trading and adds details from company’s release)
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