CMG - Chipotle Mexican Grill Inc (NYSE)

Wow! Down $2.58 today.

headed to $30 IMO...

Whats your reason for that?

CMG McDonald's Chipotle offering far oversubscribed
Friday October 6, 8:13 am ET

CHICAGO (Reuters) - McDonald's Corp. (NYSE:MCD - News) on Friday said demand by its shareholders to exchange McDonald's shares for those of Chipotle Mexican Grill Inc. (NYSE:CMG - News) far outstripped supply.

About 262.7 million McDonald's shares were tendered in the offer, in which McDonald's will divest its 16.5 million Chipotle shares.

The company said it will accept 18.6 million shares of its stock for the Chipotle shares. On Thursday it said it would exchange 0.8879 share of Chipotle class B common stock for each McDonald's share.

start watching if it moves through the 30dma and holds with volume should make higher/ high/lows

bump
Earnings May 01, 2007
Last: 66.25

Breaking out today. Low volume currently.

Stock Symbol:
CMG $ 66.94
Chipotle Mexican Grill Inc. 1.26
Shares Short 4,661,100
Days to Cover (Short Ratio) 14.9
Short % of Float 15.02 %
Shares Short - Prior 4,819,600
Short % Increase / Decrease -3.29 %
Squeeze Ranking™ 58
% from 52-Wk HIGH ( 67.77 ) -1.24 %
% from 52-Wk LOW ( 45.82 ) 31.55 %
% from 200-Day MA ( 59.53 ) 11.07 %
% from 50-Day MA ( 63.39 )
5.30 %
Price % Change (52-Wk) 25.90 %
Trading Volume - Today 394,200
Trading Volume - Average 312,600
Trading Volume Vs. Avg. 126.10 %
Total Shares - Float 31,030,000
Total Shares - Outstanding 32,646,365
% Held by Insiders 1.76 %
% Held by Institutions %
Market Cap 2,185,347,753
EPS 1.28
PE Ratio 51.30
Sector: Services
Industry: Restaurants
SI Record Date 2007-Apr


Information Provided Without Warranty

Looks good but look athe PE ratio (55). To high of a PE. They still have tons of growth of them but a bit to expensive.

how can u tell. i thought the higher the PE the good it is. How can u measure if it is pricy. If it goes over 67.77 ther can be a good squeeze because the peeak wat at 67.77 so alot of shorters are probobly shorting from that price.

You are correct in a sense. The higher the PE that a company has the more growth the company is experiencing in that particualr quarter but at the same time if a company has a high PE wall street believes that the company is a bit expensive compared to its peers.

The best way to see wether or not a company is overvalued or not is to see the companies organic and non-organic growth rate and compare it to its PE ratio. If the company is growing in the double digits and has a PE of 40 or less then it should be considered underavlued to fairly valued(depedning on the sectors money shift). If the company has a growth rate in the single digits and it has a PE of 40 or more then it should be considered expensive.

Keep in mond that this is relative. One most also look at the companies balance sheet and income statement to decide its fair value.

exactly how does this relate to a penny stock

For example lets use CMG.

CMG PE's is 53. They are growing roughly 7% Q over Q. That is a modest growth rate but it is not spectacular. Operating income has reamined steady quarter over uarter which is goo becuase this means that they have been able to keep their stores cost effective.

ROA at 7% YOY and ROE at 9% YOY.

Now if you compare it to their peers like MCD you will see that indeed CMG is already overavlued becuase MCD growth rate is roughly 14% with a PE of 17.

These are just the basics on how one must evaluate the fair value of a stock.

yea bud mcd owns some of chipotle. But hey wat are u looking at to see that they grow 7% q over q. What net income or gross profit what? I want to start examining fundamentals better and start thinking like the big boys think that move the market.

There isnt a so called formula to really tell the exact growth rate of a company but you can come close of predicting it by looking at the EPS of a company which is the net income of a company-dividends on stock/outstanding shares. You also look at the Diluted EPS and the companies sales, revenues and net income.

well what is the diluted eps and how were u able to say 7% q over q then.

Diluted EPS is simply a more detailed overview of a companies overall profitability. EPS is total revenues/outstadning shares. In the outstanding shares part you only account the common stocks but when calculating diluted EPS you would calculate options, bonds and preffered stock into it thus potraying a better view of the companies overall profitability.

The way I got 7% is by averaging both the net income, revenue, Siluted EPS and sales numbers.

I like I said this is not exactly their growth rate but it does give you a broad sense of the companies proftablty.

But looking this stock from a technical prespective it looks like it is set to breakout out of its 52 week high setting a new all time high.

If the stock sets another bullish candle tomorrow with above average volume this could be a good swing trade.

CMG
CHIPOTLE MEX GRILL
78.093,100Up 11.83Up 17.85%