Photo: SmellsLikeCactus on Flickr
Here’s your stagflation, wrapped up in a burrito.Shares of Chipotle (the pop Mexican chain) are down 3.8% after market after the company announced EPS of $1.59, below estimates of $1.67.
The culprit: Margin pressures from higher food prices.
And Chipotle isn’t going to make its shareholders eat those costs anymore, meaning they’ll be passed onto customers.
The company began hiking prices in June (by 4.5%) and it said on its conference call that that prices will be hiked at a full 80% of its restaurants.
Avocados, meat, and dairy are where they’re feeling the pinch.