The COVID-19 pandemic crippled the majority of industries, but some were able to recoup thanks to their strategically driven digital platforms. Chipotle Mexican Grill, Inc. (NYSE: CMG) is one such food restaurant chain operator that has benefited greatly from digital sales.
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So, should investors park their funds in these restaurant companies to stay afloat?
Amid the broader market sell-off due to economic uncertainties, it becomes difficult to make wise investment decisions. Every individual conducts his own due diligence before making investments, but valuable insights to pick stocks are a plus.
As a result, TipRanks’ new Website Traffic screener can guide investors in making decisions to some extent. The tool shows an estimate of consumers’ visits to the company’s websites and its correlation with the stock price.
The tool shows that the traffic on the web is increasing significantly for Chipotle. Rising visits indicate the website’s popularity and highlight the fact that the company is trending among individuals.
In April, total visits to chipotle.com represented a 19.55% surge on a year-over-year basis. Furthermore, the month of May experienced more website clicks and recorded a whopping jump of 83.72% from the prior-year quarter.
Encouragingly, year-to-date website growth, compared to year-to-date website growth in the prior year, stood at 58.64% for Chipotle. Meanwhile, compared to the first quarter, website traffic is trending higher so far in Q2, representing a rise of 49.34%.
What Next?
Also, management is positive about the company’s growth prospects. It expects Q2 comparable restaurant sales growth to be in the range of 10% to 12%.
The company also plans to open around 235 to 250 new restaurants, which suggests long-term growth prospects.
Wall Street’s Take
Recently, Stifel Nicolaus analyst Chris O`Cull reiterated a Buy rating on the stock.
In his recent report, Cull wrote, “We believe the brand can continue to drive sales momentum utilizing new menu news, digital engagement and ongoing operational improvements.”
Overall, the rest of the Street is cautiously optimistic about the stock, with a Moderate Buy consensus rating based on 13 Buys and six Holds. The average Chipotle price target of $1,768.44 implies 29.77% upside potential. Shares have lost 19.4% so far this year.
Bottom-Line
The increasing demand for ordering food online in this digital world seems to be reflected in the company’s rising website trends. Also, management’s expectations and future plans are encouraging. However, inflationary pressures and cost challenges remain concerns.
Learn more about how the website traffic tool can help with your investment research.
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