Lame Burritos Meet their Maker

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I consider myself a relatively "pure" chartist, not allowing fundamentals or folklore to influence my decisions. But with Chipotle, it was more than just the chart that compelled me to short it (as well as buy puts, which is an act I take upon myself literally once or twice a year, versus the thousands of equity trades I do).

As I have often cited here on Slope, I think Chipotle food sucks out loud. The offerings are completely middle-of-the-road, and the pledge on their menu that some (some!) of their ingredients are probably organic doesn't impress me. Nor does the fact that they charge 50% more for the same food that I can get at any given Redwood City joint (all hail Los Gallos!) Setting aside the fact that mom 'n' pop burrito joints have much tastier offerings.

Anyway, before the open, I was delighted to see their stock down about 10% pre-market, so I dumped the put and covered the stock right at the open. I think much, much lower prices are ahead, but I'm going to wait for a decent re-entry point before I refry these beans once more.


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