Chipotle Mexican Grill, Inc.

Summary

History of CMG

CMG was founded in 1993 by founder , Steve Ells with the first outlet opened in Denver , Colorado through a loan of $85,000 from his father,Bob Ells . The outlet was well received in the community and Steve was able to raise another $1.3m from friends and family for expansion purposes .

With the help of a family friend , Steve was able to get an appointment with the management of McDonalds , who committed an investment of $50m to fuel rapid growth . With the help of a corporate overlord , CMG was able to grow its outlets from 13 to  500 by 2006

In 2006 , the company decided to launch its IPO . McDonalds , which by that time owned approximately 90% of the shares decided to fully divest its stake from the company through the IPO and secondary market sale .

Profile  

CMG is a QSR chain specialising in Mexican “fast-casual” food serving burritos , burrito bowls , salads , quesadillas , tacos , etc. The company takes pride in the fact that all of its food served is devoid of artificial flavours , colors and preservatives . Another USP of CMG is the fact that the company does not use any frozen ingredients or canned food in the preparation of menu items .  All  this is enshrined in the motto of the company  - “Real Ingredients . Real Purpose . Real Flavour .”

As of 31/12/2022 , the company has 3187 restaurants spread across 5 countries – U.S.A , Canada , U.K. , France and Germany (CMG 2023) , but the company still derives a majority of its revenues ( 96.6% ) from the U.S.A , which has approximately 3102 restaurants as of 15/10/22 . The company has also recently stated that its aims to open new outlets in the Middle East – United Arab Emirates and Kuwait in 2024 . The current , CEO – Brain Niccol has stated that the long-term vision of the company is to open 7000 outlets in North America with planned expansion in other geographies as well .

Key Financial Data  

Listed on : NYSE

Tickr  : CMG

Market capitalization : $52.774 billion ( as on 27/07/23 )

P/E = 55

P/S = 6.65

P/Book = 23.78

ROA = 12.6%

ROE = 44.74%

CMG has had a stellar run in the secondary market with the share price appreciating by 370.35% in the past 5 years . It had its debut on the stock exchange on January 26,2006 when the share opened at a price of $22 per share . Since then , the company has given a  return of  approximately 4761.66% to the initial IPO investors as compared to a return of 258.43% to index fund investors in the S&P 500 ( Capital IQ) during the same period .