Chipotle beats on earnings and sales
The Mexican fast-casual restaurant chain said it earned $1.60 per share. Analysts had expected Chipotle to report adjusted earnings per share of $1.29 on revenue of $1.05 billion, according to Bloomberg.
Same-store sales, at restaurants open for at least one year, rose 17.8% (15.5% forecast.)
The company is still working to turnaround sales after an E. coli outbreak was linked to its food in 14 states in late 2015. Chipotle hired food-safety experts to scrutinize its practices and gave away free food to lure customers back.
Chipotle confirmed last week that it raised prices by about 5% in about 20% of its locations after hinting that the hikes were coming.
Some analysts have raised questions about whether Chipotle's stock is overvalued after a 25% surge since the start of the year. According to Morgan Stanley and Oppenheimer, the company will need to achieve EPS of at least $20 over teh next three years to justify the current price, although they see that as unlikely.
As the shares rose, bets against it did as well. Short interest has risen $296 million this year, according to financial-analytics firm S3 Partners. The current short interest total of $2.2 billion represents about 16% of shares outstanding.