Telsey Advisory Group reduced its price target on Chipotle Mexican Grill (NYSE:CMG) to $48.00 from $50.00 on Wednesday but left its Outperform rating in place. The adjustment follows Chipotle’s fourth-quarter 2025 report, which produced several mixed operational signals.
At the time of the update, Chipotle was trading at $39.17 and, according to InvestingPro analysis, appears undervalued despite carrying a price-to-earnings ratio of 34.44. The company’s market capitalization stood at $51.79 billion, and InvestingPro assigns Chipotle an overall financial health score classified as "GOOD" with a numeric value of 2.97.
On the headline results, Chipotle posted fourth-quarter earnings per share of $0.25, surpassing Telsey’s forecast of $0.24. Revenue for the period reached $3.00 billion, coming in above the $2.96 billion figure some analysts had expected.
Operationally, comparable sales declined by 2.5% for the quarter, a deterioration that was slightly less severe than Telsey’s projection of a 2.8% decline. Restaurant-level operating margins compressed by roughly 135 basis points to 23.4%, which nonetheless compared favorably with both Telsey’s internal target of 22.9% and the FactSet consensus figure of 23.1%.
Other sell-side activity noted alongside the Telsey update included Wolfe Research reiterating an Outperform rating on Chipotle and maintaining a $38.00 price target. Wolfe Research cited the company’s steady sales momentum and a robust digital channel as factors supporting its stance.
Taken together, the data point to a quarter in which Chipotle cleared expectations on several financial metrics while still confronting pressure in traffic and margins. The rating continuity from Telsey indicates continued confidence in Chipotle’s longer-term prospects even as near-term performance required a modest adjustment to the firm’s price objective.
Key reported figures summarized:
- EPS: $0.25 (reported) vs $0.24 (Telsey forecast)
- Revenue: $3.00 billion (reported) vs $2.96 billion (expected)
- Comparable sales: -2.5% (reported) vs -2.8% (Telsey projection)
- Restaurant-level margins: 23.4% (down ~135 bps)
- Market capitalization: $51.79 billion
- InvestingPro financial health score: 2.97 ("GOOD")
- P/E ratio: 34.44
The combination of an earnings and revenue beat with compressed margins and negative comparable sales helps explain why Telsey lowered its target while retaining an Outperform view. Market participants tracking valuation metrics through tools like InvestingPro still see the stock as offering potential upside relative to current share prices, per the analysis cited.