Chipotle inventory (CMG) fell greater than 7% Tuesday after the corporate introduced the departure of its CEO, Brian Niccol, who will take the identical function at Starbucks (SBUX) beginning subsequent month.
Niccol has been the CEO of Chipotle since 2018. Scott Boatwright, its COO, will function the corporate’s interim CEO.
Niccol has been integral to Chipotle’s rebound over the previous a number of years as the corporate recovered from an E. coli disaster that started in 2015 and weighed on shares for years.
Within the yr earlier than Niccol joined the corporate, Chipotle’s annual revenues have been round $4.5 billion; by 2023, income had greater than doubled, totaling $9.9 billion for the yr. Prior to now 5 years, the inventory has rallied greater than 240% towards an 85% acquire for the S&P 500.
Amid the chief shake-up, Chipotle CFO Jack Hartung, who had introduced plans to retire in 2025, has agreed to stay with Chiptole “indefinitely” as a president of technique, finance, and provide chain.
“Chipotle is in an excellent place,” Wedbush analyst Nick Setyan advised Yahoo Finance. “They’re in superb arms … Each gents right here which might be taking on, I credit score each of them with the turnaround as a lot as I credit score Brian Niccol. So I believe they’re in superb arms.”
He added, “They’re on autopilot, frankly. And never a lot has to alter.”
Bernstein senior analysis analyst Danilo Gargiulo agreed Chipotle is nicely positioned for the change.
“The model has advanced itself from being only a CEO-driven and CEO-led,” Gargiulo stated. “And I believe over time it has confirmed itself that it is bigger than its personal administration … Proper now we’re speaking about probably a cookie cutter method that Chipotle will have to be deploying into extra areas and develop the variety of models.”
Josh Schafer is a reporter for Yahoo Finance. Observe him on X @_joshschafer.
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