Chipotle Mexican Grill, Inc. (CMG), reported earnings after the bell today. The company posted an EPS of $3.50, coming in well above the Zacks Consensus Earnings Estimate of $3.05. On the Revenue front, CMG posted revenues of $1.05 billion beating the Zacks Consensus Revenue Estimate of $980 million. This is a +24.1% increase in Earnings year over year, and a 28.3% increase in Revenue year over year.
The main driver behind the strong results were due to price increases introduced in early May for the first time in 3 years. All items saw price increases ranging between 5% and 9% for an approximately 6% increase net total. Moreover, management has not seen any significant pushback by customers since the implementation of higher prices. Therefore, this should positively impact the next several quarters as well.
Chipotle also saw comp same store sales growth of 17.3% on the back of increased store traffic and an increase of individual patrons average check. During the quarter, the company opened 45 new stores, following managements Q1 statement that new locations would increase 11%-12% in 2014.
This company is cash heavy, and creates solid FCF, which analysts are hoping is to be soon followed by a share repurchase plan.
In afterhours trading Chipotle Mexican Grill is up over 8% on mild volume. This indicates that investors are very happy with management’s direction and their recent results.
Tomorrow Zacks will issue a fully detailed earnings report on CMG.
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