Chipotle Mexican Grill, Inc. (CMG) Traders Bullish -- Analysts, Not So Much

Despite strong technicals, Chipotle Mexican Grill, Inc. hasn't won universal support on the Street

by Alex Eppstein

Published on Dec 29, 2014 at 2:19 PM
Updated on Jun 24, 2020 at 10:16 AM

Chipotle Mexican Grill, Inc. (NYSE:CMG) is up 2% today to trade at $691.32, bringing its year-to-date advance to nearly 30%. Earlier, in fact, the stock topped out at $695 -- just south of its all-time high of $697.93, touched in late August. Not surprisingly, options traders have grown extremely bullish toward shares of the fast-casual restaurant chain.

Diving into the data, during the last two weeks at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), speculators have bought to open slightly more CMG calls than puts. The resultant call/put volume ratio of 1.16 ranks just 7 percentage points from a 12-month high, suggesting traders have displayed a healthier-than-usual appetite for bullish bets over bearish in recent weeks. To put that reading into perspective, the same ratio ended November at 0.69 -- with puts outweighing calls.

Looking more widely reveals that optimism toward CMG is by no means the consensus opinion. In fact, nearly half of the analysts covering the stock have handed out a tepid "hold" recommendation. What's more, the average 12-month price target of $720.83 stands just 3.3% above current trading levels. If Chipotle Mexican Grill, Inc. (NYSE:CMG) can sustain its run up the charts, a round of bullish brokerage notes could add fuel to its fire.


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