The increasing menu pricing at Chipotle Mexican Grill won’t put consumers off, and will help the company meet its revenue goals, according to Raymond James.
“We believe that recently announced menu price increases (4 percent in recent weeks, with more to come in the fall) create 1) significant upside to 2H consensus comp expectations and 2) increased confidence in our above-Street ’22 EPS estimates,” he wrote in a note.
Even with higher wages, Raymond James believes Chipotle will be able to regain its pre-pandemic footing in 2022.
“While recent wage increases will necessitate an adjustment to management’s margin recovery algorithm (due on the 2Q call), we remain confident in its ability to recapture best-in-class store margins (25 percent +) in 2022.” “We also remain optimistic about the company’s ability to reaccelerate unit growth into the high [single-digit] percent range over the next few years,” the note said. Chipotle shares have been sluggish in 2020, falling 6% in the last three months.
Bitcoin for diversification
In a Monday interview, noted hedge fund manager Paul Tudor Jones said that bitcoin is a good strategy to secure his money over the long-term, and he also invests in it.
The legendary investor made the remark about bitcoin as the world’s largest cryptocurrency rose nearly 10% after Elon Musk said Tesla could accept bitcoin transactions again in the future.
Following Jones’ comments, Bitcoin last traded above $40,000 per coin. Bitcoin has increased by more than 30 percent this year, despite wild swings. It reached an all-time high of $64,829.14 in April and a low of near $30,000 in May after a 30% intraday drop.
“Bitcoin is a mathematical concept. And math has been around for thousands of years, and two plus two will always equal four. “I like the idea of investing in something that is reliable, consistent, honest, and 100 percent certain,” Jones said. “As a result, bitcoin has appealed to me because it allows me to invest in certainty.”
Nonetheless, the founder of Tudor Investment Corporation and the Robin Hood Foundation expressed concern about bitcoin’s environmental impact. The Chinese and Iranian governments are cracking down on digital currency mining, in part because it consumes a lot of energy.
“If I were King of the World, I would ban bitcoin mining simply because of the environmental impact and force the ecosystem to figure out a way to do it without expanding supply at all,” Jones said.