Chipotle makes shares more accessible with 50-for-1 stock split

Chipotle (CMG) has executed a 50-for-1 stock split, a historic move for the company. As a result, shareholders received 49 additional shares for each share held, making the new trading price about $65.66 per share, down from $3,283.04. Bernstein analyst Danilo Gargiulo believes the split makes Chipotle shares more accessible to retail investors. However, he also warns of increased volatility, though he doesn’t expect it to become a meme stock.

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Chipotle shares are up 43% year-to-date, significantly outperforming the S&P 500’s 15% gain. In contrast, competitors like McDonald’s and Restaurant Brands are down 13% and 11%, respectively. Approximately 4,000 Chipotle employees will receive a special one-time equity grant. Additionally, U.S. employees with a year of service can participate in the Employee Stock Purchase Plan (ESPP), allowing them to buy shares at a discount.

Other companies like Nvidia and Walmart have also conducted stock splits this year, typically resulting in positive returns. Nvidia’s 10-for-1 split and Walmart’s 3-for-1 split have been well-received, with Walmart’s shares up nearly 13% post-split.