The price target still represents a 4.5% downside from the stock's closing price Thursday of $670.45. The stock has been on the rebound all year and has risen nearly 60% in 2019.
Wedbush channel checks suggested that same-store sales growth was 6.6% in the first quarter, which the firm said was caused by digital/delivery and marketing pushes. That marketing push is driving loyalty with the brand, which analyst Nick Seytan said he finds valuable.
"We view loyalty as a compelling value, with 10-11 transactions equating to a free entrée at CMG's current in-store average check of ~$12 and 8 digital transactions equating to a free entrée at the current digital average check of $16-17 (Figure 5). Therefore, we believe the adoption/use of loyalty could sustain YoY growth rates in digital at levels we previously believed were unrealistic as compares become difficult," Seytan said.
Chipotle shares were rising 0.5% in premarket trading Friday to $673.44.
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