Don't Call It a Comeback

In this podcast, Motley Fool contributors Travis Hoium, Jon Quast, and Rachel Warren discuss: Chipotle 's drop and falling same-store sales. Target 's lost identity. Crocs ' value. To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center . When you're ready to invest, check out this top 10 list of stocks to buy . A full transcript is below. This podcast was recorded on Dec. 10, 2025. Travis Hoium: Some of the best known stocks of the last decade have fallen in 2025. Can they make a comeback? Motley Fool Money starts now. Welcome to Motley Fool Money. I'm Travis Hoium, joined today by Jon Quast and Rachel Warren. Today, we want to talk about comebacks and potential comebacks to some really well known companies Chipotle, Target, Crocs. Those are the three that are going to be on the tip of our tongue today. But there's a number of companies that fall into this category. Chipotle stock Johanna has fallen 51% from its high in 2024. Same store sales have gone negative. This is one of those companies that seemed indestructible since the whole Ecola thing early in the 2010. But things have really turned over the past year. Has something changed? I also want to note that the valuation is something that we should talk about because this is a company that is very well known, always been very highly valued, but it still trades for 30 times earnings. Is this the stock that you're looking at? Hey, you know what? Maybe this is a stock to come back in 2026, or is it still a little too uncertain? Jon Quast: It's a good question, Travis and let's just start by saying that over the long-term, stock price is correlated with profits. Chipotle's profits are somewhat OK right now, but investors clearly believe that they're headed lower. In coming years. That's why this stock has fallen as much as it has. I think there's some credence to the fear that Chipotle's profits could fall so there's a little trend emerging. If you look over the last three quarters, Chipotle opened about 200 new locations. Average unit volumes have dropped about 3% over that time. That's actually pretty rare for Chipotle. Those average unit volumes, the sales per location per year, have gone up consistently over the last 20 years, let's say. Lower sales volume at a location is going to lead to lower profit margins. That's just how it works and accordingly, the restaurant level operating margin has fallen over the past year. Not a ton. It's still good, but it has dropped. You start looking at a company like Chipotle that has already scaled so much, almost 4,000 locations right now. It thinks that it can add 3,000 more, but are those next 3,000 locations going to be as high of sale volume, as high quality as the last 4,000? That's really the question. If it's adding a lot of underperforming...

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