Chipotle will be giving out more free food to win back customers

I'm highly pessimistic on Chipotle for the next two years and have been for the past four months. I will critically-read this article for you. Here are some interesting tid-bits from the linked "adverticle" as to why you should be pessimistic too:

The restaurant chain has doubled the amount of free food stores can give away to customers, said co-CEO Monty Moran

Zero times anything is still zero. No one I've know has ever gotten anything for free from Chipotle, and they are regularly shorted on the basic ingredients. (Guacamole has gone from being served with a ladel, to a tablespoon, to a teaspoon, price constant throughout.) Let's get this clear: this article is a cheap advertisement in disguise. Chipotle execs are hoping "FREE FOOD!!!! AT CHIPOTLE!!!" will get people into their stores, all for the price of this boring interview.

While the practice has existed at the company since the "old days," it had diminished, said CFO Jack Hartung during an interview. "We've always had it, but it just kind of drifted to such a low-grade level that it was kind of non-existent."

Hartung casually acts like this practice went bad on it's own. That's lazy management. Food comps should clearly be encouraged or be discouraged, not allowed to deteriorate like a neglected avocado. What other managerial-policies have you allowed to drift to "low-grade levels"?

Recently though, the company sent an email out detailing just how much restaurants could increase their giveaways and reward customers, Hartung said. Moran declined to share the specific allowance.

Just more artful dodging on behalf of CMG's executives proving my point that this is really just a cheap advertising piece.

Starting next February, the chain also plans to ramp up marketing in hopes of winning customers back, said Chief Marketing and Development Officer Mark Crumpacker in a presentation.

This means that this quarter's sales were awful. Whenever a firm "ramps up" marketing efforts, it always means the current and recent sales figures were awful! Watch for the steep drop in CMG price on Feb 2 when weeks of sales-less operation are finally put in ink.

Hartung pegged the ongoing margin hit from additional costs of food safety improvements to be about 100 to 200 basis points.

Margin of what? Stop being so vague! And say "percentage points", for Christ's sake! One to two percentage points of what? He is being purposefully vague and using investment jargon to cloak how much they have failed.

While Chipotle will eventually recoup some of its costs through a price increase, Hartung said this would not happen until probably 2017.

OH REALLY? This fifteen BILLION DOLLAR LUXURY-BURRITO COMPANY is going to raise prices to off-set the cost of allowing employees to take more sick days and to cover the added expense of spending a few extra minutes during training to teach employees to wash their hands a little longer after using the toilet?! You've got to be shitting me! Friends and I have stopped going to Chipotle because their burritos are already too expensive and they are too stingy on the portions. Give me a fucking break about a price increase!

/r/investing Thread