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Chipotle’s Mild Performance In For Some Spice

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Editor’s Remarks:

Chipotle has not recovered from the poor publicity of various food-safety issues, such as E-coli outbreaks, it suffered in 2015. The different marketing tactics to bring previous customers back and building new brands have failed to bring results for Chipotle so far. The culmination of these failures led activist investor Bill Ackman of Pershing Square to buy 9.9% of the company. He will be up against Steve Ells, who leads Chipotle’s small board, to introduce changes he thinks will turn the company around. Naturally, speculation is building as to what Ackman will push Chipotle to attempt, from focusing on its core brand to trying to expand internationally. Chipotle should benefit from an introduction of energy into its board which previous groups have tried to shake up in the past. As always, the movements of activist investors bring intense levels of media attention and the drama they introduce never fails to stir markets.

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