Image: Bigstock

The Zacks Retail & Wholesale sector has struggled to find its footing in 2022, down 28% and lagging behind the S&P 500’s performance.

Image Source: Zacks Investment Research

One of the most famous names in the sector, Chipotle Mexican Grill (CMG - Free Report), is on deck to unveil quarterly results on Oct. 25 after the market close. Chipotle Mexican Grill, together with its subsidiaries, operates quick-casual and fresh Mexican food restaurant chains. We see their restaurants everywhere, and generally with packed customer lines.

Currently, the company sports a favorable Zacks Rank #2 (Buy) paired with an overall VGM Score of a B. How does everything else stack up for the restaurant titan heading into the print? Let’s take a closer look.

Share Performance & Valuation

CMG shares have weathered a dark market cloud better than most in 2022, down roughly 12% vs. the general market’s decline of more than 22%.

Image Source: Zacks Investment Research

Over the last three months, the price action has been stellar, with CMG shares tacking on a double-digit 14% in value and outperforming the S&P 500 in this timeframe as well.

Image Source: Zacks Investment Research

Any relative strength is undoubtedly a highlight in a historically-volatile 2022. Further, shares trade at a 4.9X forward price-to-sales ratio, above the five-year median of 4.2X and representing a 312% premium relative to the Zacks Retail and Wholesale sector. CMG carries a Style Score of a D for Value.

Image Source: Zacks Investment Research

Quarterly Estimates

Analysts have been bullish in their earnings outlook, with four positive earnings estimate revisions coming in over the last several months. The Zacks Consensus EPS Estimate of $9.11 suggests a year-over-year earnings uptick of nearly 30%.

Image Source: Zacks Investment Research

Chipotle’s top-line is also in solid standing – the Zacks Consensus Sales Estimate of $2.2 billion indicates revenue growth of 14.4% from the year-ago quarterly sales of $1.9 billion.

Quarterly Performance & Market Reactions

CMG has been on an impressive earnings streak, exceeding the Zacks Consensus EPS Estimate in six consecutive quarters. Just in its latest print, the restaurant titan registered a 3% bottom-line beat.

Revenue results have been primarily strong, with Chipotle penciling in four top-line beats across its previous five quarters. Below is a chart illustrating the company’s revenue on a quarterly basis.

Image Source: Zacks Investment Research

In addition, it’s worth noting that shares have increased twice by double-digit percentages following two of its last three prints. Following the latest release, shares tacked on roughly 13% in value.

Putting Everything Together

CMG shares have displayed a valuable level of defense in 2022, and over the last three months, they’ve soared for a double-digit percentage gain. The company’s valuation multiples could steer away value-focused investors; the company’s forward P/S ratio sits above the five-year median and the Zacks sector average.

Analysts have been bullish on their earnings outlook, and estimates suggest notable year-over-year growth in both revenue and earnings. CMG has consistently exceeded quarterly estimates, and the market cheered on its previous quarterly release.

Heading into the print, Chipotle Mexican Grill (CMG - Free Report) carries a Zacks Rank #2 (Buy) with an Earnings ESP Score of 2%.

More By This Author: