Chipotle Plans a 50-for-1 Stock Split as Share Price Hits New Heights

Investors interested in Chipotle will soon find its shares more accessible. The popular fast-casual restaurant chain has announced a 50-for-1 stock split, marking the first such move in the company's 30-year history. Subject to shareholder approval at their June meeting, the split aims to significantly reduce the cost of investing in Chipotle, making its shares within reach for a broader range of investors.

Stock Split Details

As of Wednesday morning, Chipotle's stock was trading at a lofty $2,972 per share. Post-split, based on that price, each share would cost about $59. Chipotle aims to commence trading at the new price on June 26, pending shareholder consent. The move addresses the high entry point of its stock due to the remarkable performance in recent times.

Company Performance and Growth

Chipotle's decision comes at a time when the company is experiencing steady growth in customer foot traffic, defying wider industry challenges. Even as other giants like Starbucks and McDonald's are witnessing a decrease in customers, Chipotle is not only attracting more diners but also successfully managing an employment boost. This success led to 19,000 seasonal hires for the March through May peak season and the roll-out of enhanced benefits and an Employee Assistance Program.

Focusing on workforce satisfaction, particularly towards Generation Z employees who dominate its workforce, the company has introduced a notable perk. Eligible 401(k) contributors at Chipotle can now benefit from a match of up to 4% of their salary toward their 401(k) if they make student loan payments—a major benefit for many young workers saddled with education-related debt. Chipotle's average wage is currently $17 per hour.

Financial Performance Excelling Expectations

Chipotle's financial achievements have been outstanding recently, with a 7.4% increase in restaurant traffic and earnings per share reaching $10.36, overshadowing the anticipated $9.75. Revenue was reported at $2.52 billion. In the final quarter, the chain saw an expansion with the opening of 121 new locations, further signifying its growth trajectory.

Chipotle, stock, split