Down 46% from the highs. JPMorgan just called it a rare valuation opportunity.

Chipotle's been in a genuinely rough stretch, ngl. Traffic declined for four straight quarters through the end of 2025, first annual same-store sales drop since 2016. Management's explanation was basically a broad consumer pullback hitting every income group, with lower-income diners cutting back hardest. Stock's down about 46% from its highs while the S&P was up double digits over that same stretch. Feels pretty on-theme for this sub honestly, another data point on how much pressure regular spending is under right now.

Q1 2026 was the first real sign of a turn though. Revenue grew \~7.4% to about $3.09B, beat estimates, and transaction counts went positive for the first time in a year. Digital sales are now close to 39% of total sales, helped along by new menu stuff like Chicken Al Pastor and higher-protein options aimed at winning back people who'd drifted off. Management's deliberately not discounting to chase traffic back either. They're protecting the brand's pricing position instead, even though that means margins stay squeezed while beef costs and tariffs work against them.

In June JPMorgan upgraded it to overweight, calling the \~43% decline since early 2025 a rare valuation opportunity. Their argument: the current multiple now reflects a realistic growth profile instead of the premium Chipotle used to command. Still trades at a forward P/E in the high 20s though, above the restaurant industry average. So not a screaming bargain by any classic value metric. More like a high-quality brand trading at a discount to its own history, not an obviously cheap stock.

They're still planning to open 350-370 new restaurants in 2026 too, expansion continuing even through the softer traffic environment. That alone drives some revenue growth whether or not comps fully recover.

Real risk here: 2026 guidance calls for flat same-store sales. Management itself isn't promising a fast turnaround. This is a bet that a strong brand recovers from a rough couple years, not a bet that it already has.

[Chipotle](https://www.stoxcraft.com/stocks/cmg) is one of those where the quality of the business was never really the question, just what price you're paying for the rough patch. Anyone here buying this pullback, or waiting to see if comps actually turn positive first?