Chipotle offers many opportunities for continued growth that investors are excited about. It has fewer than 2,900 locations, less than half of its sales come from its digital channel, and delivery services only generate 1% of total revenue. The company generates substantial cash flow and the only debt on its balance sheet is related to operating leases, not loans. This limits financial risk and means Chipotle could easily find capital for growth should the need arise.
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Again, the question here is really about the valuation. Chipotle has often attracted aggressive valuation multiples, and its futures P / E ratio of 56 seems more characteristic of a tech company than an established restaurant chain. His enterprise value / EBITDA ratio of 50 indicates that this is not a situation in which earnings per share misrepresent true earnings. Chipotle is simply expensive to own. If the market offers you the opportunity to acquire stocks at a more attractive price, it is worth considering.
Visa (NYSE: V) is a household name with a brand that is almost synonymous with credit and debit cards. People see this logo every day, and it’s also featured on the front doors of countless restaurants and retailers that accept Visa cards. There’s more going on below the surface here too, and this company offers some exposure to a wider fintech revolution it happened.