Ask Matt: Can Chipotle come back into favor?

Q: Can Chipotle come back into favor?

A: The burrito chain has been struggling since the outbreak of food safety concerns last year. The stock still hasn’t recovered and analysts are skeptical it will anytime soon.

Shares of Chipotle are down 18% this year so far leaving them down 35% from a year ago. The stock closed Monday at $394, barely above its lowest point the past 12 months. Investors who thought this once red-hot stock could regain its spice have been proven wrong so far. Analysts aren’t expecting things to improve in the upcoming quarter, either. Chipotle’s adjusted profit in the current quarter is expected to plummet 78% to 98 cents a share, says S&P Global Market Intelligence. That’s better than losing money, as the company did in the first quarter, but it’s hardly a sign of recovery. All told, adjusted profit is expected to drop 70% this year to $4.61 a share and not start to recover until fiscal 2017. Adjusted profit isn’t expected to surpass 2015’s levels until fiscal 2018. Meanwhile, the stock is still 90% pricier than the market. Chipotle also still needs to find ways to woo back customers even while modifying its cooking procedures to prevent problems. Analysts rate the stock a “hold” on average, but say it could be worth $463 in 18 months.

Paste BN markets reporter Matt Krantz answers a different reader question every weekday. To submit a question, e-mail Matt at mkrantz@usatoday.com or on Twitter @mattkrantz.