Chipotle Mexican Grill (NYSE:CMG) has long been a hot favorite in burrito bowls and ETF portfolios.
However, with analysts tempering their expectations and the stock losing 18.3% year to date, ETFs that were once feasting on Chipotle might now be excusing themselves from the table.
Who’s Got Chipotle on the Menu?
Several standout ETFs include Chipotle in their holdings—either for its growth story, brand power, or margins. Here’s who’s likely mulling the latest news:
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- Consumer Discretionary Select Sector SPDR Fund (NYSE:XLY): A juggernaut ETF of large consumer favorites, XLY has had Chipotle as one of its growth bets, alongside Amazon (NASDAQ:AMZN) and McDonald’s (NYSE:MCD). But CMG’s recent softness could count against its spice factor overall. Currently, the fund has cut it’s exposure to the stock to 1.9% of its overall AUM.
- iShares U.S. Consumer Services ETF (NYSE:IYC): The fund provides general exposure to consumer services, where Chipotle’s high-end dining experience has gotten it included. Price target cuts by analysts may prompt fund managers to reconsider their holding, which has already gone down to 1.2%.
- AdvisorShares Restaurant ETF (NYSE:EATZ): Arguably the most burrito-invested fund on Wall Street, EATZ has a stake in both fast-casual and full-service restaurants. With Chipotle’s stock now plummeting, the ETF will take the burn harder, as Chipotle enjoys more than 3% of the fund’s AUM.
Though these funds aren’t ditching Chipotle quite yet, they’re definitely serving up the risk salsa as analysts call for more restraint ahead of earnings.
What’s Cooking?
When Chipotle announces earnings on Wednesday, it’ll be offering up more than just revenue and EPS—it’ll be serving up macro trends, international strategy, and how it’s coping with tariffs and cost pressures.
Guggenheim’s Gregory Francfort recently cut his price target from $56 to $48, citing weak traffic, weather issues, and lukewarm credit card data. While keeping his rating at Neutral, he anticipates a same-store sales downgrade to “flat to low single digits.”
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And Francfort’s not the only one. Other analysts are joining in. Barclays cut the price target from $60 to $56; Truist came down to $61 from $74; Wells Fargo is down to $60 from $70; UBS has gone from $70 to $65; and KeyBanc, from $64 to $60.
But some numbers provide a counterpoint. Placer.ai tracks Q1 traffic expansion of 4.5% YoY, significantly beating the fast-casual category’s 4.2% decline. Chipotle’s new Honey Chicken introduction can potentially drive comps too.
A Global Game Plan
Chipotle just revealed plans to move into Mexico in 2026 through a deal with restaurant behemoth Alsea. That would be the chain’s seventh global market. With more than 3,700 restaurants today and a 7,000-store long-term target in North America, global expansion is the new frontier, but it could be a hard sell in a rough macroeconomic climate.
At the same time, management is absorbing tariff-driven cost increases (avocados, we're looking at you), which might win over avocado loyalists but could hurt margins in upcoming guidance.
Is Chipotle Still ETF-Worthy?
While Chipotle is still a high-growth competitor with strong brand power, investors, ETF managers, and analysts like Francfort are wondering if the premium multiple is still warranted. A solid earnings report might revive optimism, but anything short of that might lead ETFs to begin cutting exposure.
Ultimately, Chipotle’s next earnings plate will indicate if it’s still a market delicacy… or merely extra guac on a dwindling budget.
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