Jim Cramer on Chipotle stock: ‘I like it to go to $2,000’

Shares of Chipotle Mexican Grill Inc (NYSE: CMG) are already up more than 25% for the year but famed investor Jim Cramer is convinced that they’re not out of room to run just yet.

Cramer’s bull case for the Chipotle stock

Cramer expects this chain of fast casual restaurants to see continued growth in sales on the back of an amazing variety on its menu. On CNBC’s “Squawk on the Street”, he said:

They’re back to having menu items that drive their sales up and it’s an exciting time because the stock is finally breaking out after multi-year consolidation and I like it to go to $2,000.

The Mad Money host is constructive also because he has confidence in the leadership of Brian Niccol who has been at the helm since early 2018.

At writing, the price-to-earnings multiple on Chipotle stock is well below its average over the past five years.

Truist analyst is also bullish on Chipotle stock

Cramer’s bullish view on the food stock is in line with Truist Securities’ analyst Jake Bartlett.

On Monday, Bartlett reiterated his “buy” rating on Chipotle stock and raised his price target to $1,960 a share that suggests about a 13% upside on its previous close.

He expects improvements in the avocado market to be a meaningful tailwind for Chipotle Mexican Grill Inc. A 10% change in “butter fruit” prices, he estimates, could mean a 30 basis points effect on the company’s margins and 69 cents a share effect on is earnings.

Chipotle is expected to earn $8.84 a share in its current financial quarter versus $5.7 per share a year ago.