Phil Town

MORE ON CHIPOTLE (HOW TO REQUEST FINANCIAL DATA FROM A COMPANY)

Here's another update from Lee re: his Chipotle research:

Thanks for the feedback as always, Phil Town. Here's what I'm up to.

I requested the information from Chipotle Investor Relations (email below). I also looked at McDonald's annual report, since they are/were a major investor. Chipotle was part of "McDonald's Ventures", along with Boston Market. So, a way for McDonald's to use their money in other segments of the market.

A recent announcement said that McDonald's is ending some benefits to Chipotle (as planned) because their ownership is decreasing. This has apparently pushed the stock down, but I view it as good news. Just waiting for the green arrows now at a lower price.

QUESTION OF THE WEEK: CHIPOTLE FOLLOWUP

This week's Question is a brief followup to Lee's Chipotle Homework.  Lee wanted to know if his MOS holds up.  I say yeah, I think we can go with the thing being on sale big time -- but keep it within the Rule 1 Risky Biz portfolio guidelines. 

More on Lee's 4m analysis below.

Phil Town,

Thanks again for posting my thoughts. Looks like there is a lot of interest in these restaurant stocks, even though they've been sinking lately.

I tried contacting Chipotle, but wasn't successful at digging up their past financials. They filed a "form 425" with the SEC on July 6 that says they will file a registration statement and prospectus regarding their separation from McDonald's. I'm not sure what this is, but I wouldn't expect to get any more information than was already published in their 2005 annual report.

CHIPOTLE HOMEWORK, PART II

Here's Part 2 of Lee's Chipotle (CMG) Homework.  My comments are at the end.

Hi Phil Town,

(I apologize up front for the length of this -- edit at will.)

First, here are a couple of recent articles on Chipotle:

1.  Investor's Business Daily recently wrote a piece (6/30/06).

Points of interest from this article:

• Profit grew 199% from 2004 to 2006
• McDonald's now owns less that 60% and will be fully divested by year end (I wonder if this selling has kept downward pressure on the stock).

YOUR HOMEWORK: CHIPOTLE MEXICAN GRILL (CMG)

Hi Phil Town,

I continue to watch Chipotle Mexican Grill (and eat their food!).

Here is my take on the 4M's.

Meaning. Chipotle's concept is "gourmet fast food" - food that takes hours to prepare and seconds to serve. They have a very simple menu - burritos, burrito bowls, tacos and salads. The customer chooses from several meats, beans, salsas and other extras, resulting in thousands of variations. The food is excellent, served in under a minute, and a great value (~$6.00 for a burrito and a drink).