Restaurant Stocks Have a Rough New Year, and Chipotle Leads the Plunge

It’s no surprise that Chipotle Mexican Grill is having a rough few months, after a string of high-profile food borne illness outbreaks, a CDC investigation, and multiple lawsuits. Stocks in the company, which had been growing steadily since 2013, hit a new 52-week low last week. This means that in three rough months, Chipotle has lost three years of gains.

Although Chipotle’s losses were predictable based on recent bad press, they come with some other context as well: 2015 was a bad year for restaurant stocks across the board, and 2016 isn’t starting out any better. Many large, publicly traded chains were down 2 to 6% last week, and some hit 52-week lows, including the Cheesecake Factory, Papa John’s, and Dunkin’ Brands. As 2016 continues, this is likely to mean far fewer new concepts will go public, even as they continue to expand, and larger corporations may focus more on acquisitions. Chipotle may be the poster child for this rough year, but they should also serve as a reminder that the restaurant market has not been friendly to anyone.

To read more, click here.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: