Shares of Chipotle Mexican Grill, Inc., the Mexican food restaurant with the largest number of branches in the U.S., hit an all-time high on Wall Street in after-hours trading after the company topped estimates for quarterly earnings and revenue.
Shares jumped 3.7 percent in extended trading to $767.00, setting an all-time high, after opening at $746.00. Chipotle shares are up 71 percent so far this year.
Net sales rose 13.2 percent to $1.43 billion, beating expectations of $1.41 billion. Digital or online sales grew a massive 99.1 percent and made up 18.2 percent of sales for the quarter.
Chipotle also boosted its 2019 same-store sales growth outlook on account of its upbeat second-quarter earnings results released Monday. Chipotle opened 20 new locations during Q2 and closed one, bringing its total restaurant locations to 2,523 stores.
Chipotle again raised its full-year outlook for same-store sales growth. It projects sales at restaurants open at least a year to increase at a high-single-digit rate compared to a prior estimate of mid-to-high single-digit growth.
Chipotle's stock has been on a tear of late, surpassing a previous record set before the fast-food chain's foodborne illness scandals began in 2015.
"We're pleased with our financial performance, which marks the sixth consecutive quarter of accelerating comps and reflects continued progress on our key strategic initiatives," said CEO Brian Niccol.
Compared to Wall Street expectations based on a survey of analysts by Refinitiv, Chipotle posted earnings per share of $3.99 (adjusted) vs. $3.76 expected. Revenue came to $1.43 billion compared to the expected $1.41 billion expected.
Its Q2 net income stood at $91.0 million ($3.22 per share), an improvement of 48 percent from $46.9 million ($1.68 per share) year-on-year.
A fast-casual restaurant chain, Chipotle is grappling against the rising cost of food (especially avocados), beverages and packaging, which rose 1.1 percent year-on-year mostly because of more expensive avocados. Avocado prices have skyrocketed since deliveries from Mexico and California have failed to meet soaring consumer demand. Guacamole, an avocado-based dip, spread, or salad, is a favorite at Chipotle's.
"I would say that biggest wildcard in terms of our margin potential is avocados," said CFO Jack Hartung.
Chipotle has been investing in new ways to take digital orders by installing special pick-up shelves and drive-through windows called Chipotlanes. Sixteen restaurants now have Chipotlanes.
