Tracking annualized 3-year EPS
Annual sales for the past 3 years
Forward-looking 5-year annualized EPS estimates
Chipotle is one of the largest fast food chains in the United States. Insatiable demand for the company’s burritos and bowls has sent the stock soaring an impressive 189% over the past five years. That includes a 30% drop from an all-time high set in September 2021.
Note that the $39 billion company has seen some volatility over the past decade. The stock fell 47% in 2012, 65% between 2015 and early 2018, and 55% in early 2020.
The current 30% sell-off in CMG could be a good entry point for long-term holders, but another 10% to 20% drop is not uncommon. Long-term trends in share prices, earnings and sales remain elevated.
Chipotle’s earnings and revenue growth has been impressive, with a compound annual growth rate of around 49% and 16%, respectively, over the past three years. Analysts expect earnings per share to grow at a CAGR of 27% over the next five years.
Note that CMG does not pay dividends.
Our handpicked list of cheap stocks to buy now was created using strict criteria. The above stocks are traded on U.S. or Canadian exchanges and meet the following requirements:
Sustainable annual EPS growth. All of the above stocks have achieved average annual EPS growth of more than 15% for at least five consecutive years.
Sustainable average annual sales growth. Select stocks have achieved annual sales growth of more than 10% for at least five consecutive years.
Earnings per share continued to grow year-on-year. In each of the past four years, earnings per share must be higher than the previous year.
No negative income for the past four years. While continued earnings growth is key, profitability is even more important, so no stock should have seen negative earnings per share over the past four years.
Sustained growth in forward-looking EPS estimates. Analysts, on average, estimate annual earnings per share growth of more than 15% over the next five years.
EPS estimates should be strong next year. Analysts’ average estimate for EPS growth next year should be 15% or more.
Long-term returns outperform the market. Each stock that met the other criteria also significantly outperformed the S&P 500. The 5-year annualized return should outperform the S&P 500’s performance by at least 10% over the same period.
Prices have fallen recently. The stocks on our list are all down 20% or more from their recent highs. Then use historical price declines to explain how lower pullbacks preceded the recovery.
The information contained in this website does not constitute, nor should it be construed as, advice, recommendation, offer and/or solicitation to buy or sell stocks, and any decision taken is the sole responsibility of the reader/user. Before deciding to buy any of these stocks, do a lot of research to make sure they fit your financial goals and risk tolerance.