Investors are going wild for El Pollo Loco, a chicken restaurant chain that debuted on the public market Friday.
The company’s shares surged an eye-popping 55% from its IPO price of $US15 on the first day of trading. So what’s so great about this chain that’s been around for more than two decades?
For many investors, it resembles the massively successful Chipotle.
Like Chipotle, it’s a fast casual chain that serves Mexican-style food in large portions. Its same-store sales growth rate is comparable to Chipotle’s, and actually surpassed Chipotle’s in 2012 and 2013, according to The Motley Fool‘s Nickey Friedman.
El Pollo Loco, which translates to “the crazy chicken,” is also extremely popular. It recently won second place for best-tasting fast food chicken restaurant in the country behind Chick-fil-A in a Consumer Reports survey.
The restaurant’s first U.S. location opened in Los Angeles in 1980. It now has 401 restaurants, more than half of which are franchised. Most of the locations are in California and the rest are in Nevada, Texas, Arizona, and Utah.
The chain is known for its citrus flavored fire-grilled chicken, which is served in family-sized portions or as part of individual dishes such as burritos, bowls, salads and tortas. Appetizers include chicken nachos and chicken tortilla soup and there are more than a half dozen sides, such as refried beans, corn, broccoli, macaroni and cheese, mashed potatoes, french fries, and rice.
The chicken is cooked over an open flame for about an hour, like in the photo below.
At the self-serve salsa bar, customers can ladle unlimited amounts of salsa, jalapenos and cilantro onto their dishes.
The avocado salsa, pictured on top of the Carne Asada Tostada below, is a customer favourite.
El Pollo Loco says 47% of their sales come from bone-in chicken meals (like the one pictured below) while the rest come from their Mexican offerings, such as burritos and tostadas.
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