Reuters: Global Markets: Chipotle restaurant shares plunge on slowing sales

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Chipotle restaurant shares plunge on slowing sales Jul 20th 2012, 14:22 Fri Jul 20, 2012 10:22am EDT (Reuters) - Chipotle Mexican Grill Inc (CMG.N) lost about a quarter of its market value in early trading on Friday after the company said sales slowed in the second-quarter, prompting at least four brokerages to cut their price targets on the stock. The burrito and taco chain's shares were down 22.6 percent at $312.66, after touching a low of $309.01, making them the biggest loser on the New York Stock Exchange. "We continue to worry about slower growth in the second half of 2012 (in the absence of) additional menu pricing, acceleration in multiyear traffic trends, or a positive margin surprise," BMO Capital Markets analyst Phillip Juhan, who cut his target price to $410 from $440, wrote in a client note. Jefferies & Co analysts led by Andy Barish said the company no longer had double-digit same-store sales to propel the stock. "Same-store sales appear to have peaked, and while a marketing push could benefit traffic, we are concerned about the company's lack of organic sales-driving initiatives," Barish wrote, cutting the price target on to stock to $305 from $362. Barclays Capital cut its price target $375 from $396 while Wedbush Securities lowered its target to $420 from $480. Chipotle's sales at restaurants open at least 13 months rose 8 percent in the quarter. (Reporting by Arpita Mukherjee in Bangalore; Editing by Ted Kerr) Link this Share this Digg this Email Reprints

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