Buffett Brain · Research note
Score updated 22 Oct 2026 · analysis from 23 Sept 2026
CMG· Consumer Discretionary
Chipotle Mexican Grill
Chipotle's high valuation and modest moat make it a less attractive investment despite strong ROIC and consistent profitability.
Buffett fit
Partial fit
Owner
43
Durability
97
Management
41
Price
22
Score updated 22 Oct 2026 · analysis from 23 Sept 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Consumer Discretionary stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
Owning 100% of Chipotle would mean managing a well-known brand with a solid of 18.5%, indicating efficient use of capital.
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Chipotle has shown strong durability with no EPS decline over the past five years and consistent profitability.
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Chipotle's management has reduced share count with a CAGR of -1.25% and a yield of 2.53%, indicating shareholder-friendly actions.
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With an earnings yield of 3.42% and an EV/ of 23.3, Chipotle is priced for perfection, leaving little .
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- The 5-year price target and the return it implies
- What would change the call
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
5- 1 of 15.8% is top-quintile in the sector.
- 2 of 18.5% exceeds the sector's top-quintile cutoff.
- 3EPS CAGR of 25.7% over the last five years.
- 4Consistent profitability with no EPS decline in five years.
Concerns
5- 1 of 29.2 suggests high growth expectations.
- 2 of 36.1% is below the sector's top-quintile.
- 3Net debt/EBITDA of 2.19 indicates concerns.
- 4Current ratio of 0.92 suggests liquidity constraints.
Price history
$28.14-20.9%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
Chipotle Mexican Grill operates approximately 3,000 restaurants primarily in the United States, generating $11.93 billion in revenue with a net income of $1.54 billion. The company benefits from a recognizable brand and a loyal customer base, but it operates in a competitive restaurant industry with moderate . The unit economics are strong with an of 15.8%, which is above the sector's top-quintile cutoff.
How this analysis has moved
The call has held across 5 reviews.
Sep 27, 2026 → Oct 22, 2026
What other investors would say
The same company, judged by three other documented playbooks.
Keep researching
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