Shares of Chipotle Mexican Grill Inc. CMG, +1.69% rose 1.6% in afternoon trade Thursday, bucking the weakness in the broader market, after KeyBanc Capital analyst Eric Gonzalez started coverage of the Mexican food fast-casual restaurant chain with a bullish overweight rating on the belief the company is headed in a better strategic direction under the leadership of Brian Niccol, who became chief executive effective March 5. Gonzalez set a stock price target of $500, which is 13% above current levels. “In our view, sweeping changes to personnel and internal processes are likely to produce positive results that consensus estimates do not fully contemplate,” Gonzalez wrote in a note to clients. He said new management is pushing to use more modern marketing techniques, to become more culturally relevant, to take a more rigorous approach to testing and scaling of new ideas and to raise awareness of its off-premise and digital capabilities. The stock’s gain comes despite a 1.2% tumbled in the S&P 500 SPX, -1.21% and the Dow Jones Industrial Average’s DJIA, -1.18% 12-point slump.
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