Pershing Square Holdings, an investment holding company, released its fourth quarter 2023 investor letter. A copy of the same can be downloaded here. During the year, the fund generated a NAV performance of 26.7% versus 26.3% for the principal benchmark the S&P 500 index. In 2023, the portfolio companies performed exceptionally well, significantly increasing their stock prices. Portfolio companies sustained growth in revenue, profitability, and shareholder value despite two conflicts and a prolonged increase in interest rates. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Pershing Square Holdings featured stocks like Chipotle Mexican Grill, Inc. (NYSE:CMG) in the fourth quarter 2023 investor letter. Headquartered in Newport Beach, California, Chipotle Mexican Grill, Inc. (NYSE:CMG) owns and operates Chipotle Mexican Grill restaurants. On March 26, 2024, Chipotle Mexican Grill, Inc. (NYSE:CMG) stock closed at $2,955.53 per share. One-month return of Chipotle Mexican Grill, Inc. (NYSE:CMG) was 10.62%, and its shares gained 78.40% of their value over the last 52 weeks. Chipotle Mexican Grill, Inc. (NYSE:CMG) has a market capitalization of $81.044 billion.
Pershing Square Holdings stated the following regarding Chipotle Mexican Grill, Inc. (NYSE:CMG) in its fourth quarter 2023 investor letter:
“Chipotle Mexican Grill, Inc. (NYSE:CMG) delivered outstanding results in 2023 driven by the company’s continued focus on exceptional food and operational excellence. Same-store sales grew 8% in 2023, or 42% from 2019 levels. Traffic growth accelerated from 4% in the first quarter to more than 7% in the fourth quarter as customers responded to Chipotle’s industry-leading value proposition, faster throughput, and successful menu innovations including its Chicken Al Pastor and Carne Asada limited time offerings. Customer feedback shows that Chipotle’s offering is closely aligned with how today’s consumer wants to eat, while serving higher quality food than its fast casual competitors at 20-30% lower prices.
Chipotle’s robust sales growth and attractive unit economics resulted in 230bps of restaurant-level margin expansion in 2023. While management made encouraging progress during the year, it still sees significant opportunity to improve in-restaurant execution, which should further increase profitability and enhance the customer experience in the near term.
We believe Chipotle is in the early innings of a decades-long growth story. In North America, management expects to grow its restaurant count at a rate of 8% to 10% per annum, with the goal of more than doubling its store base to at least 7,000 locations. International expansion remains a largely untapped opportunity, with the company just beginning to increase investment in Europe and recently announcing its first-ever franchise agreement in the Middle East. In addition to opening new restaurants, Chipotle’s many growth opportunities in existing restaurants include menu innovations, loyalty program enhancements, and the long-term potential to offer breakfast and leverage automation technology to simplify operations.”
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Chipotle Mexican Grill, Inc. (NYSE:CMG) is not on our list of 30 Most Popular Stocks Among Hedge Funds. At the end of the fourth quarter, Chipotle Mexican Grill Inc (NYSE:CMG) was held by 56 hedge fund portfolios, down from 57 in the previous quarter, according to our database.
We discussed Chipotle Mexican Grill, Inc. (NYSE:CMG) in another article and shared Artisan Mid Cap Fund’s views on the company. In addition, please check out our hedge fund investor letters Q4 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
