Chipotle (CMG) is back to heaping on the savory sales gains seemingly every quarter.
The burrito and salad bowl chain pummeled Wall Street’s second quarter sales and earnings expectations on Tuesday. Chipotle reported sales surged 13% from the prior year to $1.43 billion, aided by a 99% surge in online ordering as the company focuses on improvements to its digital ordering. Analysts expected $1.41 billion. Earnings came in at $3.99 a share versus estimates for $3.76 a share.
Chipotle’s stock popped as much as 4% in after-hours trading today.
“We are back, but we feel like we are only just getting started,” Chipotle CEO Brian Niccol told Yahoo Finance.
Chipotle’s overall sales were powered by an insane (hey, it’s competitive out there in the restaurant space) 10% same-store sales increase, gains that haven’t been seen since the chain’s heydays five years ago. The result was fueled mostly by growth in the number of transactions. Analysts had projected an 8.4% increase in same-store sales sales.
Niccol says a combination of better operations, better marketing and better tasting food has helped Chipotle regain customers.
Chipotle bull
Chipotle’s strong same-store sales increase — and the quality of it (transaction and price growth) — will go a long way to satisfying the bulls that have bet big on turnaround agent — CEO Brian Niccol. Credit Suisse, for instance, recently initiated Chipotle’s stock at an Outperform due to its potential around digital ordering, new menu items and what those factors could mean the bottom line.
The investment bank sees Chipotle’s stock reaching $870, up from $768 currently.
Credit Suisse’s call on Chipotle — and others like it around Wall Street of late — arrive despite the stock’s already heady advance under Niccol. The company’s stock has skyrocketed 62% over the past year, dusting the likes of McDonald’s (up 32%) and the S&P 500 ( up 7%).
Yahoo Finance’s Heidi Chung contributed to this story.
Brian Sozzi is an editor-at-large and co-host of The First Trade at Yahoo Finance. Follow him on Twitter @BrianSozzi
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