“This Used to Be $11….” Chipotle Mexican Grill Stock (NASDAQ:CMG) Surges Despite Customer Concerns About Pricing

Everything costs more these days. That used to be a platitude, but now, it is a way of life. Fast-casual restaurant stock Chipotle Mexican Grill CMG +3.23% ▲ is discovering this much for itself, and customers are starting to question whether that fast-casual leader is even worth it these days. But investors are certainly on board, as shares surged up 3% in Monday morning’s trading.

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Matt Rieck, a TikTok user, took to the platform to describe his experience ordering Chipotle after hitting the gym. And he was not at all happy. From his video: “Has Chipotle lost its damn mind? Granted, we got double meat, but we didn’t get chips, we didn’t get guac. $52.64 for two bowls and two drinks at Chipotle? This used to be like $11 bucks for a burrito bowl.”

Lower- and middle-income households are starting to reconsider restaurants altogether, especially fast food, where “affordability” was one of the biggest selling points for years. But a recent study found that 78% of Americans now consider fast food a “luxury” purchase, and half of respondents found that eating out is just too tough an expense to justify now. Perhaps worst of all, 71% of people earning under $30,000 say that fast food is now an “occasional treat” due to costs. This does not hold up well for Chipotle.

The Tattooed Brand

Just recently, Chipotle offered a Friday the 13th deal special for those who were willing to do something drastic, or just mildly silly. Those who went into a Chipotle with a tattoo of a Chipotle bag visible on their bodies would qualify for a buy-one-get-one burrito deal. And while some might think the cost of a tattoo is far greater than a burrito, the good news was you could simply draw your own tattoo on and qualify. And if you had the Chipotle rewards app, you would even land a special “Tatted Like a Chipotle Bag” badge for your trouble.

The downside was that you had to have that tattoo and be prepared to present it at one of the slowest times of day for a Chipotle: between three and four in the afternoon. Given how many people were at work during that time, it was a safe bet there would not be many takers.

Is Chipotle a Buy, Sell or Hold?

Turning to Wall Street, analysts have a Strong Buy consensus rating on CMG stock based on 21 Buys and six Holds assigned in the past three months, as indicated by the graphic below. After a 34.5% loss in its share price over the past year, the average CMG price target of $45.46 per share implies 35.58% upside potential.

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