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Chipotle Mexican Grill has hit a weak patch, for the business and the stock.
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Wingstop is growing its business rapidly and revenue is still expanding quickly.
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Wingstop’s business model is drastically different from Chipotle Mexican Grill’s model.
Chipotle Mexican Grill (NYSE: CMG) disappointed investors when it reported first-quarter 2025 earnings. The stock is down about 25% from its 52-week high. Wingstop (NASDAQ: WING) posted weakening results, too, but it managed to do better than Chipotle. Is it a better buy with its stock around 35% below its 52-week high? Here’s what you need to know.
Without getting into the details of the food concept, Chipotle Mexican Grill operates fast-food restaurants. The concept has proven to be very popular over the years, leading to a long period of growth. But the first quarter of 2025 wasn’t exactly an impressive performance update.
The company’s sales rose 6.4%, but its same-store sales fell 0.4%. So the top-line growth was entirely driven by new locations that were opened. There were 57 restaurants opened in the quarter. Same-store sales highlight the performance of locations that have been open for at least a year. So the decline in this figure means that customers aren’t returning as often as they were. While a 0.4% drop isn’t terrible, it is a sign that Chipotle may not be resonating with consumers as well as it once had.
Again, without getting into the food concept, Wingstop is a fast-food chain. The concept has proven to be very popular over the years, leading to a long period of growth. The first quarter of 2025 wasn’t great for Wingstop, but it was better than the first quarter Chipotle experienced.
The top line of Wingstop’s income statement grew 15.7% with same store sales up 0.5% in the U.S. market, which is its main operating region. That same store figure is a drop from the fourth quarter of 2024 when it achieved 10.1% growth. Slower same-store-sales growth isn’t ideal but it isn’t terrible so long as the figure remains positive, especially when combined with a growing store base. Wingstop opened 126 new locations in the first quarter of 2025.
There are a number of factors to consider when looking at these two restaurant companies. For example, valuation might be something you examine. But both Wingstop and Chipotle have price-to-earnings ratios of around 45. At one point Wingstop’s P/E was much higher than that of Chipotle, but the deeper price pullback of the shares has resolved that disparity.
