In the last month, Chipotle stock (CMG) has slumped by roughly 25%, primarily due to concerns about slowing traffic from younger and lower-income customers, which prompted the company to lower its sales forecast for 2025. This slump followed an already challenging year for the stock, though its long-term growth prospects are still seen as intact by some analysts.
What people are saying:
Declining customer visits: During its third-quarter 2025 earnings report, Chipotle noted a drop in transactions, particularly among its key 25–35 age demographic, citing factors like unemployment and slower wage growth.
Guidance cut: The company reduced its full-year comparable restaurant sales forecast for 2025 for the third consecutive quarter, now expecting a low-single-digit decline instead of a flat result.
Industry-wide trend: The pullback in consumer spending isn't exclusive to Chipotle; other fast-casual restaurants like Sweetgreen and Cava have also experienced stock declines.
Management initiatives: To combat this, CEO Scott Boatwright announced plans to invest more in marketing, digital experiences, menu innovation, and enhancing its rewards program.
Is it going down again?
Uncertainty remains: The stock's future trajectory is uncertain, and opinions on whether the recent downturn is a buying opportunity or a warning sign are mixed.
Market sentiment: Many on Wall Street are waiting for more solid evidence of progress before committing a larger price increase.
Investor concerns: If comparable sales decline accelerates or earnings per share, growth is slower than anticipated, it could put more pressure on the stock.
Seeking Alpha's analysis
Seeking Alpha's analysis, published on October 30, 2025, suggests that the recent "rancid plunge offers a tasty opportunity" for investors, with an upgrade from "Sell" to "Hold". The reasoning includes:
Premium valuation concerns: While the stock traded at a premium in the past, it has pulled back significantly, potentially offering a more attractive entry point.
Long-term growth prospects: Chipotle's fundamental growth algorithm remains intact, supported by aggressive new restaurant expansion and promising international franchising initiatives.
Share buybacks: The company has been strategically buying back shares when prices are low, which could provide support for the stock.
Analyst divergence: Analysts have varying opinions on the stock's future, with some growing more cautious due to macroeconomic pressures.