{"schemaVersion":1,"research":true,"symbol":"cmg","name":"Chipotle Mexican Grill","topic":"moat","path":"/stock/cmg/moat","status":"published","version":4,"updatedAt":"2026-10-18T13:40:20.518Z","locked":false,"publicFairValue":false,"fairValue":null,"moat":{"verdict":"uncertain","summary":"Chipotle has demonstrated restaurant expansion, substantial digital demand and some realized pricing ability. The passages do not establish that these strengths create a durable advantage over competing restaurants. Positive transactions in early 2026 follow declining comparable sales in 2025, while menu price increases only partly offset rising operating costs. This supports mixed pricing power and an established brand franchise, but insufficient evidence for a narrow or wide moat.","advantages":[{"mechanism":"intangible_assets","claim":"Brand recognition and convenient restaurant and digital access are plausible sources of advantage. Current reach and demand are demonstrated; durable brand preference over competitors is not.","durability":"The established footprint and digital sales support current relevance. Neither their persistence nor a defensible competitive premium is established. Equipment improvements and the refreshed growth strategy offer potential rather than proven durable protection.","risks":"Competitors offer similar service channels and ingredient positioning. Comparable sales declined in 2025, and management subsequently reported renewed sales headwinds. Pricing has not fully protected operating cost ratios.","invalidation":"Persistent transaction declines over successive comparable quarters, accompanied by discount dependence or menu price increases that repeatedly fail to offset costs, would undermine the tentative brand advantage. Establishing a moat would require sustained repeat demand and differentiation that competitors cannot readily match.","competitors":[],"evidenceIds":["e1","e2","e3","e4","e5"],"counterEvidenceIds":["e6","e7","e8","e9","e10","e11"]}],"evidence":[{"id":"e1","sourceId":"filing-2","location":"MD&A / restaurant footprint at June 30, 2026","excerpt":"As of June 30, 2026, we owned 4,074 Chipotle restaurants throughout the United States and 112 international Chipotle restaurants."},{"id":"e2","sourceId":"filing-2","location":"MD&A / second-quarter 2026 average check and transactions","excerpt":"The increase is attributable to a 1.2% increase in average check and a 1.0% increase in transactions."},{"id":"e3","sourceId":"filing-2","location":"MD&A / digital sales share","excerpt":"Digital sales represented 38.3% of total food and beverage revenue for the three months ended June 30, 2026, an increase from 35.5% for the three months ended June 30, 2025."},{"id":"e4","sourceId":"filing-2","location":"MD&A / menu price contribution to second-quarter labor cost ratio","excerpt":"These increases were partially offset by a 0.4% benefit from menu price increases."},{"id":"e5","sourceId":"filing-3","location":"Shareholder letter / management account of equipment results","excerpt":"The results in restaurants with the new equipment are compelling with higher taste-of-food and overall guest satisfaction scores, improved throughput and a meaningful increase in comparable sales."},{"id":"e6","sourceId":"filing-1","location":"Business / competing service channels","excerpt":"Many of our competitors also offer dine-in, carry-out, online, catering, and delivery services."},{"id":"e7","sourceId":"filing-1","location":"Business / competing ingredient and value positioning","excerpt":"Among our main competitors are restaurant formats that claim to serve higher quality ingredients without artificial flavors, colors and preservatives, and that serve food quickly and at a reasonable price."},{"id":"e8","sourceId":"filing-3","location":"Compensation discussion / 2025 comparable sales decline","excerpt":"Comparable restaurant sales decreased 1.7%."},{"id":"e9","sourceId":"filing-2","location":"MD&A / recently experienced comparable sales headwinds","excerpt":"We have recently experienced low-single-digit headwinds to our comparable restaurant sales trends that we believe are tied to that environment as customers respond to, among other things, recent U.S."},{"id":"e10","sourceId":"filing-2","location":"MD&A / second-quarter and first-half labor cost ratios","excerpt":"Labor Costs Three months ended June 30, Percentage Six months ended June 30, Percentage 2026 2025 change 2026 2025 change (dollars in millions) (dollars in millions) Labor costs $ 836.5 $ 756.3 10.6 % $ 1,641.9 $ 1,474.5 11.4 % As a percentage of total revenue 25.0 % 24.7 % 0.3 % 25.5 % 24.8 % 0.7 % Labor costs increased 0.3% as a percentage of total revenue for the three months ended June 30, 2026 compared to the three months ended June 30, 2025."},{"id":"e11","sourceId":"filing-2","location":"MD&A / other operating cost ratios","excerpt":"Other Operating Costs Three months ended June 30, Percentage Six months ended June 30, Percentage 2026 2025 change 2026 2025 change (dollars in millions) (dollars in millions) Other operating costs $ 499.8 $ 428.7 16.6 % $ 980.4 $ 843.8 16.2 % As a percentage of total revenue 14.9 % 14.0 % 0.9 % 15.2 % 14.2 % 1.0 % Other operating costs increased 0.9% as a percentage of total revenue for the three months ended June 30, 2026 compared to the three months ended June 30, 2025."},{"id":"e12","sourceId":"filing-6","location":"MD&A / first-quarter 2026 transactions and average check","excerpt":"The increase is attributable to an increase in transactions of 0.6%, partially offset by a 0.1% decrease in average check."},{"id":"e13","sourceId":"filing-3","location":"Compensation discussion / 2025 operating margin comparison","excerpt":"Operating margin was 16.2%, a decrease from 16.9% in 2024."},{"id":"e14","sourceId":"filing-2","location":"Market risk / discretion over menu prices and guest resistance","excerpt":"Increases in ingredient prices could adversely affect our results if we choose for competitive or other reasons not to increase menu prices at the same rate at which ingredient costs increase, or if menu price increases result in guest resistance."},{"id":"e15","sourceId":"filing-1","location":"Accounting policies / point-of-sale revenue recognition","excerpt":"Revenue Recognition We generally recognize revenue, net of discounts and incentives, when payment is tendered at the point of sale."},{"id":"e16","sourceId":"filing-1","location":"MD&A / 2025 and 2024 operating cash flow","excerpt":"Cash provided by operating activities was $2.1 billion for the year ended December 31, 2025, compared to $2.1 billion for the year ended December 31, 2024."},{"id":"e17","sourceId":"filing-1","location":"MD&A / actual 2025 capital expenditure","excerpt":"Our total capital expenditures for 2025 were $666.3 million."},{"id":"e18","sourceId":"filing-1","location":"Note 7 / actual annual share repurchases","excerpt":"During the years ended December 31, 2025, 2024, and 2023 we repurchased $2,417,673, $995,765, and $589,840 of stock at an average price per share of $42.54, $57.21, and $36.55, respectively."},{"id":"e19","sourceId":"filing-2","location":"Note 6 / first-half 2026 share repurchases","excerpt":"During the six months ended June 30, 2026 and 2025, we repurchased $1,331,572 and $989,580 of stock at an average price of $34.35 and $52.32, respectively."},{"id":"e20","sourceId":"filing-2","location":"MD&A / first-half operating cash flow","excerpt":"Cash provided by operating activities was $1.3 billion for the six months ended June 30, 2026, compared to $1.1 billion for the six months ended June 30, 2025."},{"id":"e21","sourceId":"filing-2","location":"MD&A / tax timing contribution to cash flow growth","excerpt":"The increase was primarily due to timing of tax-related payments, and to a lesser extent other changes in non-tax operating assets and liabilities."},{"id":"e22","sourceId":"filing-3","location":"Compensation discussion / implemented 2025 long-term incentive structure","excerpt":"Key features: Our LTI mix for 2025 was 60% PSUs with a three-year performance period, 20% seven-year term stock only stock appreciation rights (“SOSARs”) that vest in two equal installments on the 2nd and 3rd anniversaries of the grant date, and 20% in either SOSARs or restricted stock units (“RSUs”), at the executive’s election, that vest in two equal installments on the 2nd and 3rd anniversaries of the grant date."},{"id":"e23","sourceId":"filing-3","location":"Compensation discussion / actual 2025 performance and company payout factor","excerpt":"CPF Performance Goals Metric Weighting Threshold Performance Target Performance Maximum Performance 2025 Actual Results 2025 % Payout CRS 40% 2.0% 5.0% 10.0% (1.7)% 0% RCF Margin % 40% 26.25% 27.0% 28.5% 25.62% 0% SARs 20% 438 460 490 490 200% Total CPF 40% Individual Performance Factor (“IPF”) An executive’s AIP payout also depends on his or her achievement of individual performance goals."},{"id":"e24","sourceId":"filing-3","location":"Compensation discussion / year-end executive ownership guideline compliance","excerpt":"As of December 31, 2025, all of our NEOs who were employed by us at year end satisfied or exceeded these requirements."},{"id":"e25","sourceId":"filing-3","location":"Corporate governance / current independent chair and committee structure","excerpt":"Board Leadership Structure Our current Board leadership structure consists of an independent Chairman of the Board, a position held by Scott Maw; Board committees led by independent directors; executive sessions of the directors at each regular Board meeting; and active oversight by all directors."},{"id":"e26","sourceId":"filing-3","location":"Governance summary / majority voting and resignation requirement","excerpt":"Directors are elected by a majority of votes cast in uncontested elections and any director who does not receive a majority of votes cast is required to submit his or her resignation for consideration by the Board."},{"id":"e27","sourceId":"filing-3","location":"Compensation discussion / adopted executive recovery policy","excerpt":"Chipotle’s Executive Compensation Recovery Policy requires the Board to pursue reimbursement of incentive-based compensation paid or awarded to an executive officer if the payment or award was based on the achievement of certain financial results that subsequently were the subject of a restatement, and a lower payment or award would have been made to the executive officer based upon the restated financial results."},{"id":"e28","sourceId":"filing-3","location":"Compensation discussion / actual 2025 restaurant openings","excerpt":"We opened 334 company-owned restaurants, with 257 locations including a Chipotlane, our digital order drive thru pickup lane, and 11 international partner-operated restaurants."},{"id":"e29","sourceId":"filing-3","location":"Compensation arrangements / change-in-control equity acceleration terms","excerpt":"In addition, all unvested LTI held by the named executive officer at the time of termination would vest in full, with PSUs vesting at the greater of (a) target or (b) actual performance, as determined based on the company’s performance through the date of the change in control."},{"id":"e30","sourceId":"filing-2","location":"Market risk / June 2026 cash and investment resources","excerpt":"As of June 30, 2026, we had $810.5 million in cash and cash equivalents, current and long-term investments, and restricted cash, of which the majority are interest bearing."},{"id":"e31","sourceId":"filing-1","location":"Market risk / December 2025 cash and investment resources","excerpt":"As of December 31, 2025, we had $1.3 billion in cash and cash equivalents, current and long-term investments, and restricted cash, of which the substantial majority are interest bearing."}],"changes":["Retained the previous uncertain verdict: the supplied evidence demonstrates operating strengths but does not establish structural competitive protection.","Added explicit pricing and management assessments using operating outcomes, implemented compensation arrangements and current governance disclosures.","Clarified that digital sales share measures channel usage, and transaction growth provides only indirect evidence of retention."],"limitations":["Assessment uses only supplied passages. All source dates have dateKind filed; they are filing dates, not retrieval dates or necessarily the dates of underlying events.","Competition passages identify generic restaurant categories rather than named competitors. Companies named as compensation peers, suppliers or investees do not establish competitor coverage.","No comparative procurement costs, market-share persistence, customer cohort behavior or demonstrated switching friction establish structural protection. Scale alone does not establish cost advantage or efficient scale.","Equipment benefits and strategy success are management assertions without quantified controlled comparisons in these passages. Forecast expansion and technology initiatives remain potential.","Actual operating results and contractual disclosures support numerical pricing and management grades, but do not establish exceptional durability. Average check includes mix and cannot be treated as a pure menu price measure.","Ownership guideline compliance is disclosed, but individual beneficial ownership amounts and the guideline multiples are absent from the supplied passages. Governance policies establish arrangements rather than proof of their effectiveness in every circumstance."],"qualityAssessments":[{"category":"moat","checks":[{"criterion":"structural_advantage","grade":null,"rationale":"Restaurant reach and digital demand are established, but comparative differentiation and barriers to replication remain insufficiently evidenced.","evidenceIds":["e1","e3","e6","e7"]},{"criterion":"durability","grade":null,"rationale":"The passages do not establish how long a competitive advantage could persist. Growth and equipment initiatives cannot establish durable protection.","evidenceIds":["e5","e28"]},{"criterion":"customer_dependency","grade":null,"rationale":"Transaction growth supports current demand but does not establish dependency, switching friction or persistent customer preference over alternatives.","evidenceIds":["e2","e12","e6"]},{"criterion":"erosion_resilience","grade":null,"rationale":"Sales recovery and realized price benefits coexist with prior comparable sales declines, renewed headwinds and cost pressure; structural resilience cannot be established.","evidenceIds":["e2","e4","e8","e9","e10","e11"]}]},{"category":"pricing_power","checks":[{"criterion":"realized_pricing","grade":2,"rationale":"Menu price increases delivered a disclosed labor cost ratio benefit. Second-quarter average check and transactions both increased, following a first-quarter check decline. These demonstrate some pricing realization, with mixed outcomes and no pure price-versus-mix decomposition.","evidenceIds":["e4","e2","e12"]},{"criterion":"retention","grade":2,"rationale":"Positive comparable transactions in both early-2026 quarters provide indirect evidence of continuing demand. The 2025 comparable sales decline and renewed headwinds temper that evidence. No repeat-customer rate is supplied; digital share alone does not prove loyalty.","evidenceIds":["e2","e12","e8","e9","e3"]},{"criterion":"margin_resilience","grade":1,"rationale":"Realized price increases partly cushioned labor pressure, but labor and other operating cost ratios rose and 2025 operating margin declined. The observed protection against cost pressure is weak, although this does not by itself establish an absent moat.","evidenceIds":["e4","e10","e11","e13"]},{"criterion":"contractual_freedom","grade":3,"rationale":"Point-of-sale transactions and explicit discretion over menu price changes support strong practical freedom to reset customer prices. Competitive resistance constrains economic realization; this is not unlimited pricing power or evidence about every delivery agreement.","evidenceIds":["e14","e15","e4"]}]},{"category":"strong_management","checks":[{"criterion":"capital_discipline","grade":2,"rationale":"Actual 2025 operating cash flow substantially exceeded capital expenditure and supported expansion. However, large repurchases exceeded cash remaining after that expenditure, and further first-half 2026 repurchases accompanied declining cash and investment resources. Cash flow growth benefited from tax timing. Outcomes support mixed discipline; repurchase value creation is unproven.","evidenceIds":["e16","e17","e18","e19","e20","e21","e30","e31"]},{"criterion":"incentive_alignment","grade":3,"rationale":"Implemented multiyear performance equity, disclosed executive ownership guideline compliance and a reduced 2025 company payout factor demonstrate meaningful alignment. Change-in-control provisions allowing PSUs to accelerate at the greater of target or actual performance weaken that alignment. No exceptional grade is warranted.","evidenceIds":["e22","e23","e24","e29"]},{"criterion":"execution","grade":2,"rationale":"Actual restaurant openings and improving comparable transactions demonstrate execution, assessed partly through indirect operating outcomes. They coexist with 2025 sales and margin misses and subsequent operating cost pressure. Management's equipment success claims provide supplementary, less conclusive evidence.","evidenceIds":["e28","e2","e12","e23","e10","e11","e5"]},{"criterion":"governance","grade":3,"rationale":"The disclosed current independent chair and committee structure, majority voting with a resignation requirement, and adopted compensation recovery policy establish strong governance safeguards. These are actual arrangements rather than proposed awards or assumed leadership qualities; their effectiveness and exceptional durability are not established.","evidenceIds":["e25","e26","e27"]}]}],"financialAssessments":[],"qualityPolicy":"quality-scores-2","sourcePolicy":"issuer-evidence-4","basisHash":"6486fa4ecf3b9c267eb6ba1c7d84e1348c7089de18db2eb0a426bf1baccd7528","updatedAt":"2026-10-18T13:40:20.518Z","sources":[{"id":"filing-1","url":"https://www.sec.gov/Archives/edgar/data/1058090/000105809026000009/cmg-20251231.htm","publishedAt":"2026-02-04","sha256":"6af5db84a786063de0344d0fd0bc33019d7c034ca62b657a28b2f9c8bad001da","dateKind":"filed"},{"id":"filing-2","url":"https://www.sec.gov/Archives/edgar/data/1058090/000105809026000066/cmg-20260630.htm","publishedAt":"2026-07-31","sha256":"20fc3cfc6f28c611e869c6638c917d812a5f3f494f56eb89ce556b1cb1df59d9","dateKind":"filed"},{"id":"filing-3","url":"https://www.sec.gov/Archives/edgar/data/1058090/000114036126017294/ny20063214x1_def14a.htm","publishedAt":"2026-04-28","sha256":"c4e465ab07e7e2929273fbe98d6fbdf4c42905357e6a5186f4242d23fc67ca2f","dateKind":"filed"},{"id":"filing-4","url":"https://www.sec.gov/Archives/edgar/data/1058090/000105809025000014/cmg-20241231.htm","publishedAt":"2025-02-05","sha256":"914e66ab7d61e19666b48e130a6e144bd9e5673243871938f2720a2f6a31a1d5","dateKind":"filed"},{"id":"filing-5","url":"https://www.sec.gov/Archives/edgar/data/1058090/000156276224000023/cmg-20231231x10k.htm","publishedAt":"2024-02-08","sha256":"36f1dc24ae5da9e9daa64b18235747afade2fad5e3ce02f1d9c4746392ea1ef6","dateKind":"filed"},{"id":"filing-6","url":"https://www.sec.gov/Archives/edgar/data/1058090/000105809026000028/cmg-20260331.htm","publishedAt":"2026-04-30","sha256":"82d2e75c7725ecf97b877ffc716eee18bbfcba40a5238d976dce267c090c241f","dateKind":"filed"}],"model":"gpt-6.1-sol","providerId":"codex:eedfe821ab6215f2815d25b5666c68e5d923739240afc1a09b6afc8f5f6e878f","usage":{"input_tokens":80837,"cached_input_tokens":21120,"cache_write_input_tokens":0,"output_tokens":3371,"reasoning_output_tokens":101},"basisSupplement":{"previousHash":"0cd9c16bca10704020ea15733fa1bc6359181c0ea717554dd7f613ca307cb3c0","checkedAt":"2026-10-18T16:49:32.080Z","rule":"dated historical and missing inputs only; accepted observations and research date retained"}},"signals":[{"period":"2021","end":"2021-12-31","values":{"gross_margin":null,"operating_margin":10.665648521987565,"roic":44.6902724950407,"fcf_margin":11.124939893820917,"sbc_revenue":2.337227696980321},"issues":{"software_capex":"Separately disclosed software and intangible investment is unavailable in the extracted statements for this period.","gross_margin":"The reported inputs required for this metric are unavailable in the extracted statements for this period.","roic_wacc":"Enter a WACC assumption from 0 to 100%.","interest_coverage":"The reported inputs required for this metric are unavailable in the extracted statements for this period."}},{"period":"2022","end":"2022-12-31","values":{"gross_margin":null,"operating_margin":13.438908713402695,"roic":50.95311718532375,"fcf_margin":9.77474251423219,"sbc_revenue":1.1353092168624745},"issues":{"software_capex":"Separately disclosed software and intangible investment is unavailable in the extracted statements for this period.","gross_margin":"The reported inputs required for this metric are unavailable in the extracted statements for this period.","roic_wacc":"Enter a WACC assumption from 0 to 100%.","interest_coverage":"The reported inputs required for this metric are unavailable in the extracted statements for this period."}},{"period":"2023","end":"2023-12-31","values":{"gross_margin":null,"operating_margin":15.780676561737558,"roic":52.666085003832066,"fcf_margin":12.386441211594944,"sbc_revenue":1.2562845376694411},"issues":{"software_capex":"Separately disclosed software and intangible investment is unavailable in the extracted statements for this period.","gross_margin":"The reported inputs required for this metric are unavailable in the extracted statements for this period.","roic_wacc":"Enter a WACC assumption from 0 to 100%.","interest_coverage":"The reported inputs required for this metric are unavailable in the extracted statements for this period."}},{"period":"2024","end":"2024-12-31","values":{"gross_margin":null,"operating_margin":16.937934406607546,"roic":54.07870697448136,"fcf_margin":13.35948946835353,"sbc_revenue":1.1643248325747206},"issues":{"software_capex":"Separately disclosed software and intangible investment is unavailable in the extracted statements for this period.","gross_margin":"The reported inputs required for this metric are unavailable in the extracted statements for this period.","roic_wacc":"Enter a WACC assumption from 0 to 100%.","interest_coverage":"The reported inputs required for this metric are unavailable in the extracted statements for this period."}},{"period":"2025","end":"2025-12-31","values":{"gross_margin":null,"operating_margin":16.232288838105514,"roic":54.92484637859811,"fcf_margin":12.138507736423513,"sbc_revenue":1.0024065034542073},"issues":{"pfcf_growth":"TTM FCF per diluted share growth is zero or negative; a growth-adjusted multiple requires positive growth.","software_capex":"Separately disclosed software and intangible investment is unavailable in the extracted statements for this period.","gross_margin":"The reported inputs required for this metric are unavailable in the extracted statements for this period.","roiic":"Invested capital did not increase versus the prior year. ROIIC requires a positive increase.","roic_wacc":"Enter a WACC assumption from 0 to 100%.","interest_coverage":"The reported inputs required for this metric are unavailable in the extracted statements for this period."}}],"sources":[{"id":"filing-1","url":"https://www.sec.gov/Archives/edgar/data/1058090/000105809026000009/cmg-20251231.htm","publishedAt":"2026-02-04","sha256":"6af5db84a786063de0344d0fd0bc33019d7c034ca62b657a28b2f9c8bad001da","dateKind":"filed"},{"id":"filing-2","url":"https://www.sec.gov/Archives/edgar/data/1058090/000105809026000066/cmg-20260630.htm","publishedAt":"2026-07-31","sha256":"20fc3cfc6f28c611e869c6638c917d812a5f3f494f56eb89ce556b1cb1df59d9","dateKind":"filed"},{"id":"filing-3","url":"https://www.sec.gov/Archives/edgar/data/1058090/000114036126017294/ny20063214x1_def14a.htm","publishedAt":"2026-04-28","sha256":"c4e465ab07e7e2929273fbe98d6fbdf4c42905357e6a5186f4242d23fc67ca2f","dateKind":"filed"},{"id":"filing-4","url":"https://www.sec.gov/Archives/edgar/data/1058090/000105809025000014/cmg-20241231.htm","publishedAt":"2025-02-05","sha256":"914e66ab7d61e19666b48e130a6e144bd9e5673243871938f2720a2f6a31a1d5","dateKind":"filed"},{"id":"filing-5","url":"https://www.sec.gov/Archives/edgar/data/1058090/000156276224000023/cmg-20231231x10k.htm","publishedAt":"2024-02-08","sha256":"36f1dc24ae5da9e9daa64b18235747afade2fad5e3ce02f1d9c4746392ea1ef6","dateKind":"filed"},{"id":"filing-6","url":"https://www.sec.gov/Archives/edgar/data/1058090/000105809026000028/cmg-20260331.htm","publishedAt":"2026-04-30","sha256":"82d2e75c7725ecf97b877ffc716eee18bbfcba40a5238d976dce267c090c241f","dateKind":"filed"}],"history":[{"version":4,"updatedAt":"2026-10-18T16:49:32.080Z","verdict":"uncertain","value":null},{"version":3,"updatedAt":"2026-10-18T16:35:43.872Z","verdict":"uncertain","value":null},{"version":2,"updatedAt":"2026-10-18T02:27:49.793Z","verdict":"uncertain","value":null},{"version":1,"updatedAt":"2026-10-18T02:18:02.026Z","verdict":null,"value":null}],"hasRequested":false,"requestStatus":"completed","researchIssue":null,"archivedMoat":null,"scope":"supported_catalog"}