Bank Of America Downgrades Chipotle For Paying Workers Too Much


"BANK OF AMERICA Merrill Lynch downgraded Chipotle and warned investors that the stock will “underperform,” complaining that the restaurant chain is paying its workers too much, and that cutting labor costs further will be difficult for the chain. Watch the full episode here: “We are downgrading Chipotle to Underperform from Neutral as we believe, assuming no significant tax reform, that 2018 and 2019 consensus EPS needs to drop at least 10 percent,” analyst Gregory Francfort told CNBC Wednesday. “We believe further gains from trimming hours will prove difficult which limits the opportunity to get labor below 27 percent of sales even if traffic recovers.” But Chipotle spokesperson Chris Arnold called Bank of America’s analysis “flawed and inaccurate,” adding that the restaurant chain hasn’t cut employee hours but recently increased hours in conjunction with the addition of queso to the menu."* Read more here: Follow Jimmy Dore on Twitter: Follow Steve Oh on Twitter: Follow Malcolm Fleschner on Twitter: Follow Ron Placone on Twitter: