Should You Buy Chipotle Ahead of Its Stock Split?

Everyone’s wondering about the Chipotle stock split.

To buy or not to buy ahead of the split?

For reference, the Chipotle stock split is a 50-for-1 split and will take place on June 26.

You’ll want to have Chipotle shares in your account before that date to take advantage.

But the real question is… Why would you buy the stock? Is it a good value? Is fast food even going to be around in the near future?

Well, let’s start with this question…

Have you eaten fast food lately?

If you’d asked me that question 10 or even five years ago, I would have said I was probably eating out at least once a week at places like Taco Bell, McDonald’s, Wendy’s, Chick-fil-A, and Chipotle at least once a week.

Now? It’s more like maybe once every six months.

And that’s for a few key reasons.

First and foremost, fast food is terrible for you. It’s all heavily processed and filled with sugar. It will make you fat and sick, no doubt about it.

Second, I enjoy cooking. I’ve made a habit out of creating dishes that resemble fast food items. Want a Chipotle burrito bowl? Make it yourself. Replace the sour cream with plain Greek yogurt and you’ll be making these at home all the time.

Finally, the price! I mean, who are we kidding anymore? Fast food has now become a “luxury” item. That’s because inflation has completely goaded upper management into raising prices. If they were savvy, they’d lower prices and get more business, but that’s not how greedy people run businesses…

Just take a look at the price increase at some of your favorite fast-food spots:

According to FinanceBuzz, “The restaurants… evaluated raised prices by 60% on average between 2014 and 2024. That means they’ve raised prices at a rate nearly double the national rate of inflation.”

Can you say “rip-off”?

The only reason people used to buy fast food was because it was fast and cheap.

But now you’re literally paying a bunch of heartless executives at McDonald’s to kill you by eating their food.

You’ve got to think twice about what you’re doing with your dollar.

And at places like Chipotle, you can’t even spend physical money anymore.

Get this…

I walked into my local store and stood in line like a good customer. There was a family ahead of me and a few people sitting in chairs not eating anything, seemingly waiting for their orders.

“That’s weird,” I thought.

I looked around and noticed the workers behind the counter were making mobile to-go orders, as they were grabbing printed receipts and not taking the order of the family in front of me.

The staff kept calling out the names of customers and people kept coming in and grabbing their food. I didn’t really think anything of it, but after about 10 minutes, the staff called the family’s name and they took their food and left.

At this point, it was just me and someone else behind me in line. Naturally, I walked up to the counter to order, but I couldn’t…

The employee told me they were “online only,” directing me to the small sign they had posted on the counter that had been obscured by the family in front of me.

When the man behind me asked why, she said she was the only person working the line.We were a bit shocked that the restaurant wouldn’t just take our orders face-to-face.

At first glance, it’s not that big a deal. But as I started to think about it more, it made me wonder what the world would look like if every business was run like this and every transaction was performed online.

No cash, no card, just your phone.

Is this where we’re headed?

The Chipotle Barometer

Think about it.

Isn’t Chipotle a kind of barometer for the state of the country?

Hear me out on this one…

It was one of the first companies to go “cashless.”

It was directly and detrimentally affected by the recent supply chain mess and food shortages.

Inflation caused it to raise prices.

And now it’s testing the population for what it can get away with…

At the end of 2021, it opened a digital-only store concept in Ohio called Chipotlane Digital Kitchen…

And now it’s testing online-only ordering.

So it shows that a) people don’t carry cash and b) everyone’s ordering food online.

But the problems with this are obvious.

The first problem is it limits human interaction.

Believe it or not, it’s healthy for humans to interact with other humans. I worked at a park store for my first job, and the experiences I got cannot be replaced. Learning people’s quirks, making small talk, MAKING CHANGE — probably one the best skills to have in any business.

The second problem is it prices people out of the market who don’t have the internet.

What happens if you don’t have a phone? What if you don’t have the internet?

We’ve come to accept these services as the standard way of life, and companies like Chipotle are using that to profit from us. According to the FCC, approximately 100 million Americans don’t have internet access. Are you going to tell them they can’t order a sloppy, subpar rice-and-bean burrito by handing you a $10 bill?

And how is ordering online any different from just walking into a store, pulling out your phone, and ordering in front of the counter? The short answer is it’s not, which is why customers were waiting in the store and in the parking lot for their food after ordering on their phones, causing a confusing scene.

The third problem is that switching to an all-online platform opens the door for security issues.

What happens if the system gets hacked, or the power goes out, or the Wi-Fi is down?

No food, no business.

The real kicker is this doesn’t end at Chipotle.

Imagine you can only pay for things online…

No more cash, no more checks.

Constant monitoring of what you’re spending your money on.

So look, the point is this…

Remember what I mentioned above… pay attention to what you’re spending your dollar on.

Do you really want to invest in a company that sells burritos… just because of a stock split?

Sure, the company is like a revolving money machine, but only if people keep buying their product.

Right now that doesn’t seem to be slowing down, but we as a society are dangerously close to just rejecting this whole fast-food market altogether.

And when that happens, well, it won’t be pretty.

Stay frosty,

Alexander Boulden
Editor, Wealth Daily

Check us out on YouTube!

After Alexander’s passion for economics and investing drew him to one of the largest financial publishers in the world, where he rubbed elbows with former Chicago Board Options Exchange floor traders, Wall Street hedge fund managers, and International Monetary Fund analysts, he decided to take up the pen and guide others through this new age of investing.

Alexander is the investment director of Insider Stakeout — a weekly investment advisory service dedicated to tracking the smartest money on the planet so that his readers can achieve life-altering, market-beating returns. He also serves at the managing editor for R.I.C.H. Report, a comprehensive service that uses the highest-quality investment research and strategies that guides its members in growing their wealth on top of preserving it.

Check out his editor’s page here.

Want to hear more from Alexander? Sign up to receive emails directly from him ranging from market commentaries to opportunities that he has his eye on.