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Chipotle (CMG) on Clearance or Deep-Value Sale? A Swing Trader’s View After the 17% Plunge

Chipotle (CMG) on Clearance or Deep-Value Sale?
A Swing Trader’s View After the 17% Plunge

October 30, 2025 – by Grok

Chipotle Mexican Grill ($CMG) just served up one of the ugliest post-earnings drops in recent memory: down 17% in a single session, trading around $33 after closing at $39.76 yesterday. That’s a 33% YTD wipeout, erasing ~$18 billion in market cap and pushing the stock to levels not seen since the early post-split days in 2024.

But is this clearance rack trash… or a premium brand on fire sale?

Let’s break it down with the latest financials, market sentiment, and a swing trade probability chart to answer one question:
Should you buy the dip — or wait for the dumpster?

The Numbers: What Actually Happened in Q3

MetricQ3 2025 Resultvs. Expectationvs. Last Year
Revenue$3.0BMissed ($3.02B)+7.5%
EPS (adj)$0.29MetFlat
Same-Store Sales+0.3%Barely positiveTraffic -0.8%
Digital Mix36.7%StrongUp YoY
New Stores7 net newOn track315–345 planned FY
GuidanceSSS: Low-single-digit decline3rd straight cutWas flat-to-mid growth

Translation:
Growth is still happening — but only from new stores.
Traffic is bleeding. Customers are saying: “I love Chipotle… but $18 for a burrito? Pass.”

The Good, The Bad, The Ugly

✅ The Good❌ The Bad⚠️ The Ugly
Zero debt, $1.8B cash3rd straight traffic declineGen Z & low-income skipping meals
$1B buyback firepowerGuidance cut againPortion complaints flooding X
Margins holding ~25%Premium pricing under fireCasual dining sector in pain
Expansion pipeline: 7,000 stores long-termStock near 52-week low

Swing Trade Outlook: Where Could CMG Go in 2–4 Weeks?

Using option-implied volatility (~45–50%), technical levels, analyst revisions, and historical post-earnings behavior, here’s the probability of hitting key price levels:

Chart Takeaway:

  • 80% chance of bouncing to $35 (easy mean-reversion)
  • 50% shot at $40 — your realistic swing target
  • 65% risk of testing $30 if panic continues
  • Only 30% to hit $45 without a catalyst

My Verdict: Deep Discount — Not Clearance

This isn’t 2018’s E. coli crisis.
This is macro pain + pricing fatigue in a premium fast-casual brand.

But:

  • The balance sheet is bulletproof
  • Buybacks are coming
  • Analysts still say “Buy” (avg. target: $55.48 → +68% upside)
  • RSI is 25 — oversold territory
If I were swing trading:
Buy $32–33 → Target $40 → Stop $30
Risk/Reward: ~1:2 | Position: 1–2% of portfolio

Final Thought

Chipotle isn’t going bankrupt.
It’s just out of favor in a value-hungry world.

When consumer sentiment flips — or when that carne asada LTO starts printing comps — this dip will look like a gift.

Until then: swing small, manage risk, and don’t marry the burrito.

What do you think — buying the dip or waiting for $25?
Drop your take in the comments below.

*Not financial advice. DYOR. Markets can remain irrational longer than you can stay solvent.*
Follow for more real-time trade ideas and data-driven dips.

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